Determinanten und Effekte von Venture Capital und Private Equity: Eine Literaturanalyse

The development of venture-capital markets represents an important economic-policy objective and has been pushed in particular by instruments of EU-wide policies, such as the “Juncker Plan” and investment of the European Investment Fund In the first part of the paper, effects of venture capital and private equity on various economic outcomes, such as employment, investment and economic growth, are examined. Here, the focus is on the added value for the economy generated by venture capital in the form of higher employment, value creation or innovation activity. Venture capital is both micro- and macroeconomically an important development factor for an economy, which is associated with higher innovation, productivity and further positive outcomes In the second part, we analyze which location factors are decisive for the establishment of venture capital and private-equity funds, as well as which factors increase demand for VC/PE and, in equilibrium, lead to the development of VC and PE markets. It turns out that the availability of venture capital and private equity depends on a number of location factors. Both the supply and demand sides are relevant. Fiscal policies (such as corporate taxation and taxes on carried interest), and legal and cultural elements are essential. The work contributes to a better understanding of success factors of an economy and allows to derive comprehensive economic-policy recommendations to make locations more attractive for venture capital and private equity.