Venture Capital and Leveraged Buyout: What Is the Difference in Eastern Europe? – A Cross-Country Panel Data Analysis
The aim of this paper is to compare the determinants of leveraged buyout activity, respectively venture capital activity in Eastern European countries. Additionally, this paper presents the main highlights in terms of evolution of leveraged buyout investments and venture capital investments during...
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| Format: | Article |
| Language: | English |
| Published: |
European Institute of Romania
2017-12-01
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| Series: | Romanian Journal of European Affairs |
| Subjects: | |
| Online Access: | https://rjea.ier.gov.ro/wp-content/uploads/articole/RJEA_vol.17_no.2_dec.2017_art_2.pdf |
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| Summary: | The aim of this paper is to compare the determinants of leveraged buyout activity, respectively venture capital activity in Eastern European countries. Additionally,
this paper presents the main highlights in terms of evolution of leveraged buyout investments and venture capital investments during the recent crisis in the European emerging countries. The panel data analysis used in this paper will include determinants consecrated in previous studies such as GDP growth, market capitalization or R&D expenditures, as well as new variables such as productivity and corruption index. In order to estimate a panel data model with fixed and random effects, we collected data on leveraged buyout activity, respectively venture capital activity in Eastern European countries over the period 2000-
2013. This paper will follow the methodology developed by Gompers and Lerner (1998), Jeng and Wells (2000), Romain and de La Potterie (2004), Félix (2007) and Bernoth and Colavecchio (2014). The present research paper shows that the LBO and the venture capital are differently affected by macroeconomic conditions. Based on our empirical results, we have pointed several strategic directions that are meant to support the development of the leveraged buyout and venture capital markets in Eastern Europe. |
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| ISSN: | 1582-8271 1841-4273 |