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on Entrepreneurship |
| By: | Köppl-Turyna, Monika; Köppl, Stefan; Christopulos, Dimitris |
| Abstract: | In this paper we analyze how different types of venture capital investments - private, public and indirect public - affect performance of "cleantech" start-ups in Europe. We hand collected a unique dataset on the institutional setting (public/indirect/private) of almost 15000 investors in Europe, which we combine with portfolio-company and deals data from Preqin to assess performance. Two results stand out: First, public venture capital does not underperform private venture capital in a broad crosscountry sample of European deals. This is a novel finding, as it doesn't confirm some previous findings in the literature that government-backed VCs underperform their private counterparts. We also find that there is no significant difference between direct and indirect government support of venture capital for cleantech investments. Second, GVCs perform well when they specialize in cleantech investments and are well connected within a network of other investors. |
| Keywords: | venture capital, governmental venture capital, European Investment Fund, public policy, green technology, cleantech |
| JEL: | G24 G28 H81 L26 D73 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ecoarp:280983&r=ent |
| By: | Wentian Zhang |
| Abstract: | This paper studies the effect of antitrust enforcement on venture capital (VC) investments and VC-backed companies. To establish causality, I exploit the DOJ's decision to close several antitrust field offices in 2013, which reduced the antitrust enforcement in areas near the closed offices. I find that the reduction in antitrust enforcement causes a significant decrease in VC investments in startups located in the affected areas. Furthermore, these affected VC-backed startups exhibit a reduced likelihood of successful exits and diminished innovation performance. These negative results are mainly driven by startups in concentrated industries, where incumbents tend to engage in anticompetitive behaviors more frequently. To mitigate the adverse effect, startups should innovate more to differentiate their products. This paper sheds light on the importance of local antitrust enforcement in fostering competition and innovation. |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2312.13564&r=ent |
| By: | Akbas, Ozan E.; Betz, Frank; Gattini, Luca |
| Abstract: | The credit gap in this study is given by the financing needs of firms that are bankable but discouraged from applying for a loan. To quantify the credit gap, we combine a scoring model that assesses the creditworthiness of discouraged firms with a credit allocation rule. Our study covers 35 emerging markets and developing economies and uses the 2018-2020 EBRD-EIB-World Bank Enterprise Survey. We show that on average discouraged firms are less creditworthy than successful applicants. Nonetheless, the share of bankable discouraged firms is large, suggesting inefficient credit rationing. The baseline results point to an aggregate credit gap of 8.4% of GDP with significant variation across countries. SMEs account for more than two-thirds of the total, reflecting both their contribution to economic activity and the fact that they are more likely to be credit-constrained. |
| Keywords: | credit rationing, discouraged borrowers, firm-level data, EMDEs |
| JEL: | D22 D45 E51 G21 G32 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:eibwps:280955&r=ent |
| By: | Andrea Bellucci (University of Insubria and MoFiR); Alexander Borisov (University of Cincinnati and MoFiR); Alberto Zazzaro (University of Naples Federico II, CSEF and MoFiR.) |
| Abstract: | This paper studies the interplay between allocation of decision-making authority and information production within a bank in the context of small business lending. Using a sample of credit lines to small businesses and changes in the overlap between decision-making authority and information production following an organizational restructuring of the bank, we show that an increase in the authority of the information-producing loan officer leads to a reduction in the use of collateral but leaves interest rates broadly unchanged. The reduction of collateral requirements is more pronounced when loan officers have tacit local knowledge or soft information or when their real authority is limited pre-restructuring. Our results highlight the effect of alignment of information production and decision-making authority on the contract terms of bank credit. |
| Keywords: | Soft and hard information, Collateral, Interest rate, Organizational hierarchies, SMEs financing. |
| JEL: | D83 D21 G21 G30 L11 |
| Date: | 2023–11–29 |
| URL: | http://d.repec.org/n?u=RePEc:sef:csefwp:697&r=ent |
| By: | Kroft Kory; Laliberté Jean-William; Leal Vizcaíno René; Notowidigdo Matthew J. |
| Abstract: | We develop a theory of commodity taxation featuring imperfect competition along with love-of-variety preferences and endogenous firm entry and exit, and we derive new formulas for the efficiency and pass-through of specific and ad valorem taxes. These formulas unify existing canonical ones and feature a new term capturing the effect of variety on consumer surplus. Intuitively, if taxes reduce product varieties in the market, then the impact on social welfare depends on how much consumers value variety. As a proof-of-concept, we use the theoretical formulas to identify love-of-variety preferences in an empirical application. Our welfare analysis shows that the marginal excess burden of taxation is very sensitive to the estimated love-of-variety, which can overturn classical results on the desirability of ad valorem versus specific taxation. |
| Keywords: | Public economics;Taxation;Tax incidence;Sales tax |
| JEL: | H20 H22 H71 |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:bdm:wpaper:2023-20&r=ent |