Working Paper

Driving Forces of Venture Capital Investments in Europe: A Dynamic Panel Data Analysis

Kiel Working Papers, 1172

Using dynamic panel estimations, this paper identifies driving forces of venture capital activity for Western European countries. Driving forces might be the liquidity of stock markets, human capital endowment, and labour market rigidities. The paper shows that these factors do not affect expansion stage investments used as a broader definition of venture capital, while they positively affect early stage investments used as a narrow definition. Thus, the results suggest not only that liquid stock markets play an important role for the development of venture capital markets but also that they are not the only factor that drives venture capital activity.


Andrea Schertler


Publication Date
JEL Classification
G24, G32