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Synergizing Ventures

Author

Listed:
  • Ufuk Akcigit

    (University of Chicago)

  • Emin Dinlersoz

    (U.S. Census Bureau)

  • Jeremy Greenwood

    (University of Pennsylvania)

  • Veronika Penciakova

    (University of Maryland)

Abstract

Venture capital and growth are examined both empirically and theoretically. Empirically, VC-backed startups have higher early growth rates and patenting levels than non-VC-backed ones. Venture capitalists increase a startup's likelihood of reaching the right tails of firm size and innovation distributions. Furthermore, there is positive assortative matching: better venture capitalists match with better startups, creating a synergistic effect. An endogenous growth model, where venture capitalists provide both expertise and financing to business startups, is constructed to match these facts. The degree of assortative matching and the taxation of VC-backed startups are important for growth.

Suggested Citation

  • Ufuk Akcigit & Emin Dinlersoz & Jeremy Greenwood & Veronika Penciakova, 2019. "Synergizing Ventures," 2019 Meeting Papers 36, Society for Economic Dynamics.
  • Handle: RePEc:red:sed019:36
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
    • N20 - Economic History - - Financial Markets and Institutions - - - General, International, or Comparative
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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