learning from own and others previous experience the contribution of the venture capital firm to the likelihood of a portfolio company s trade sale the objective of this paper is to examine to what extent different venture capital firms contribute to the likelihood that the portfolio company in which they invested will realize a trade sale we use arguments from learning theory to hypothesize the relationship between vicarious experiential and congenital learning of the venture capital vc firm and the trade sale hazard of its portfolio companies based on our analysis of 206 vc backed uk start ups we find that both trade sale experience of the vc and learning from syndicate partners with trade sale experience significantly increase the trade sale hazard the routines and procedures learned from experienced syndicate partners complement experience accumulated through trial and error congenital trade sale experience of the investment managers on the contrary has no significant influence on the acquisition hazard

how do learning externalities influence the evaluation of ontario s renewables support policies abstract support programs for renewable electricity generation in ontario have been in place since 2005 including feed in tariffs and a competitive procurement process these programs have been criticized on a number of fronts in particular critics claim the level of support was excessive and creating surplus supply however prior studies have ignored one potential benefit of renewable energy support that it can help to promote cost reductions in new technologies through learning by doing this paper uses a recursive dynamic computable general equilibrium cge model featuring learning by doing effects to assess the renewable support programs provided in ontario our results in line with previous studies do not justify the high support rates paid in ontario given our core range of assumptions but our modeling approach allows us to identify the combination of key parameter values relating to learning effects and environmental damages that justify the observed rates these parameters are hard to measure empirically and our modeling approach introduces a new tool for examining the impact of variations in these parameters on policy analysis

reassessing the relationships between private equity investors and their portfolio companies the scope and purpose of this special issue is to reassess the relationships between private equity pe investors and their portfolio companies in the light of the need for venture capital private equity vc pe firms to adapt their strategies for value creation in the light of the recent financial crisis we particularly focus upon vc pe characteristics that differently contribute to portfolio firm performance the papers presented in this special issue capture this aim in various ways reflecting the heterogeneity of vc pe investors and the firms in which they invest we begin this introductory paper by providing a brief overview of each paper s contribution we articulate themes for an agenda for future research relating to the heterogeneity of investor types and the contexts in which they invest

an assessment of proposed energy resource tax reform in russia a static general equilibrium analysis abstract a large part of government revenues in russia comes from royalties and export taxes on crude oil oil products and gas recently the russian government has considered reducing export taxes on crude oil and oil products compensated by an increase in the royalty on crude oil the objective of the paper is to analyse the economy wide effects of this proposal moreover a hypothetical replacement of export taxes and royalties with a pure rent tax is analysed a static single country multi sector computable generation equilibrium cge model is employed the primary findings are as follows a replacement of export taxes on crude oil and oil products with a royalty on crude oil provides substantial allocative efficiency gains but this policy is not a superior one welfare could be substantially improved when the export taxes and royalty are replaced with a pure rent tax that can be implemented in the form of a cash flow tax on the negative side reducing export taxes on crude oil and oil products results in a strong appreciation of the currency as a result domestic producers become less competitive in domestic markets and there is a massive increase in import demand

venture capitalists as principals contracting screening and monitoring there is a large academic literature on the principal agent problem in financial contracting this literature focuses on the conflicts of interest between an agent who is an entrepreneur with a venture that needs financing and a principal who is the investor providing the funds for the venture theory has identified a number of ways that the investor principal can mitigate these conflicts first the investor can structure financial contracts i e the allocation of cash flow and control rights between the entrepreneur and investor to provide incentives for the entrepreneur to behave optimally second the investor can engage in information collection before deciding whether to invest in order to screen out ex ante unprofitable projects and bad entrepreneurs and third the investor can engage in information collection and monitoring once the project is under way despite the large volume of theory empirical work has lagged behind in comparing the contracts and actions of real world principals to their counterparts in financial contracting theory in this paper we describe recent empirical work and its relation to theory for one prominent class of such principals venture capitalists vc s in our view vc s are real world entities that closely approximate the investors of theory vc s invest in entrepreneurs who need financing to fund a promising project or company vc s have strong incentives to maximize value but at the same time receive few or no private benefits of control although they are intermediaries vc s typically receive at least 20 percent of the profits on their portfolios see paul gompers and josh lerner 1999 in addition to being interesting from a theoretical perspective vc actions and contracts of are interesting from a practical perspective vc s have been extremely successful in the last several years i they have been associated with a number of the prominent corporate successes like ariba cisco ebay and yahoo ii they have generated substantial returns and wealth for their investors and iii they have raised and invested record amounts of money

the impact of resource tax reform on china s coal industry abstract contributing to approximately two thirds of primary energy consumption coal usage is the focus of china s energy policies to regulate the resource taxation system and reduce the burden of coal enterprises the chinese government launched a reform of its resource tax system in 2014 for coal introducing the ad valorem system to replace the volume based system that had been in place for the preceding thirty years to assess the impact of the tax reform this paper constructs two stage dynamic game models by taking the coal and coal fired power industries as the players the market situations of shortage and oversupply are investigated separately empirical data are collected to estimate the model parameters for numerical simulations the model results suggest that the tax reform will reduce both coal prices and the coal industry profitability if the tax levied on each ton of coal is maintained at the same level as before the reform regardless of whether the market is in a shortage or an oversupply situation however the increased buyer s power will amplify the effect of the tax reform the numerical simulations also provide an estimation of the tax rate of the ad valorem system that maintains the profit of the coal industry considering the demand and supply situations in china s coal market policy recommendations are provided to guide further reform of china s resource tax system

so2 emission reduction decomposition of environmental tax based on different consumption tax refunds abstract acid rain in china is mainly caused by man made so2 emission in order to reduce so2 emission environmental protection tax law of people s republic of china has been implemented on january 1 2018 this study based on environmental cge model analyses the impact of different ratio of environmental tax revenue refunded to consumption tax on china s economy and further decomposes sectors so2 emissions reduction into output scale effect process emission effect intermediate input substitution effect energy substitution effect and imported domestic energy substitution effect results show that environmental tax can effectively reduce so2 emission and not always hurt the economy with the tax refund ratio rising gdp appears an upward trend in varying degrees 0 25 0 21 and so2 emission reduction shows a downward trend 3 81 3 28 a critical point of tax refund ratio is found to locate at 59 5 which represents the maximum amount of so2 emission reduction without sacrificing economy for the so2 emission reduction sectors combustion emission reduction of oilgas and coal play a leading role after specific decomposition the energy substitution effect dominates the so2 emission reduction further emission reductions of so2 mainly focus on high pollution sectors such as power building materials manufacturing and paper factors driving emission changes in sectors may differ substantially therefore the environmental tax does not necessarily hurt the economy and can effectively curb high pollution sectors so2 emission stimulating the demand for clean energy like gas and upgrading energy structure

outside enterpreneurial capital this article investigates factors that affect rejection rates in applications for outside finance among different types of investors banks venture capital funds leasing firms factoring firms trade customers and suppliers partners and working shareholders private individuals and other sources taking into account the non randomness in a firm s decision to seek outside finance the data support the traditional pecking order theory further the data indicate that firms seeking capital are typically able to secure their requisite financing from at least one of the different available sources however external finance is often not available in the form that a firm would like this article engages with four interrelated empirical questions first what are the characteristics of privately held entrepreneurial firms that seek external outside finance and what drives the request for capital from the different potential sources of external finance banks venture capitalists private individuals leasing factoring suppliers customers partners working shareholders among other sources second what are the factors that lead to rejection or acceptance of requests for external finance given this non randomness in the types of firms that seek external finance in the spirit of heckman 1976 1979 third as various forms of financing are far from being perfect substitutes are there differences in the ability of firms to obtain capital from the different available sources fourth can firms obtain all of their desired capital from the different available sources even if it is not in the form they would like it is widely recognised that the decision to seek external finance and the type of financing sought is related to information asymmetries faced by investors regarding the entrepreneurial firm s quality see for example jensen and meckling 1976 1 where

the participation of new technology based firms in eu funded r d partnerships the role of venture capital this paper investigates the participation of new technology based firms ntbfs in eu funded r d partnerships we examine whether venture capital vc backed firms are more likely to enter these partnerships than their non vc backed peers and the role of the ownership and governance of the vc investor we resort to a mixed method approach we use qualitative information collected through interviews with managers of ntbfs and vc firms to better illustrate our deductively derived theoretical hypotheses that are then tested through a large scale econometric analysis the econometric analysis takes advantage of the vico dataset which includes longitudinal data on 8346 ntbfs from seven european countries observed from 1995 to 2008 out of which 758 were vc backed the econometric results show that vc backing has a strong positive impact on ntbfs participation in eu funded r d partnerships but the magnitude of this effect rapidly decreases with ntbfs prior experience of this type of partnership moreover the magnitude of the impact of vc backing considerably differs depending on the type of investor with bank and government vc exhibiting the strongest positive effects

finance firm size and growth the authors examine whether financial development boosts the growth of small firms more than large firms and hence provides information on the mechanisms through which financial development fosters aggregate economic growth they define an industry s technological firm size as the firm size implied by industrial specific production technologies including capital intensities and scale economies using cross industry cross country data the results indicate that financial development exerts a disproportionately large effect on the growth of industries that are technologically more dependent on small firms this suggests that financial development accelerates economic growth by removing growth constraints on small firms and also implies that financial development has sectoral as well as aggregate growth ramifications

a decision support system for financial and social investment this article proposes a decision making model that assesses the different aspects associated to social venture capital svc investment decisions svc companies buy shares of investee companies valued according to financial and social aspects the proposed model includes three main factors the previous experience with the company the past its financial information and intangible assets the present and the proposed project considering financial and social criteria the future the model has 26 criteria and 160 indicators prioritized by means of analytic hierarchy process ahp ahp simplifies a complex problem using a hierarchical analysis methodology which enables subjective judgements among different criteria the model has been tested in a given svc company its development is explained in this article

vagabond shoes longing to stray why foreign firms list in the united states abstract how do firms that go public decide whether to list on a major stock exchange or locally using a unique data set on israeli ipos in the us and tel aviv we show that companies that list in the us are young and overwhelmingly high tech oriented we argue that high quality innovative firms are willing to incur additional costs associated with listing in the us in order to reveal their value and distinguish themselves from firms that issue stock back home costs of listing in the us include first day underpricing and relinquishing corporate control

retaining winners can policy boost high growth entrepreneurship abstract we analysed the growth impact delivered by a high growth entrepreneurship policy initiative over a six year period using an eight year panel that started two years before the initiative was launched and propensity score matching to control selection bias we found that the initiative had more than doubled the growth rates of treated firms the initiative had delivered a strong impact also on value for money basis in addition to producing the first robust evidence on the growth impact delivered by a high growth entrepreneurship initiative we contribute to public sponsorship theory with the notion of capacity boosting activities to complement previously discussed buffering and bridging activities

venture capital availability and labor market performance around the world this article studies the effects of venture capital on the performance of the labour market using data from a much larger sample of countries than previous papers it finds more readily available venture capital to favourably affect both the unemployment and the employment rate the magnitude of the estimated effects is substantial we control for both endogeneity of venture capital availability and most major determinants of labour market performance the results are robust to variations in specification

on growth drivers of high tech start ups exploring the role of founders human capital and venture capital abstract in this paper we jointly analyze the effects of the human capital of founders and access to venture capital vc financing on the growth of 439 italian new technology based firms ntbfs we rely on econometric models that control for survivorship bias and the endogeneity of vc financing as to non vc backed firms the competence based argument that the capabilities of ntbfs coincide with founders skills is confirmed nonetheless once a ntbf obtains vc this coincidence vanishes pointing to the coach function performed by vc investors conversely the view that sees the scout function as the main task performed by vc investors is not supported

exploring the impacts of regional unbalanced carbon tax on co_2 emissions and industrial competitiveness in liaoning province of china carbon tax is regarded as a useful policy instrument to achieve the environmental target efficiently however the effect of regional unbalanced carbon tax is still unknown in this study an improved two region computable general equilibrium cge model is developed to fill this research gap with liaoning province and the rest of china roc as the study area business as usual bau and nine carbon tax scenarios are designed results show that in 2030 the highest carbon tax of 221 usd ton co 2 in taxc4p8 scenario in liaoning province will lead to carbon reduction of 44 92 with the cost of 5 54 gross domestic product gdp loss price effect and scale effect are the two mechanisms that affect the changes in gdp industrial output and co 2 emissions industrial structure energy consumption and carbon intensity of liaoning are overwhelmingly affected by the price effect most less energy intensive industries belong to the winner industries due to the higher influence of domestic market by contrast loser industries including most of the energy intensive industries are mainly affected by the changes of provincial and international markets roc region is mainly affected by the price effect suggestions about preferential developmental industries are offered to balance the environmental and economic concerns

corporate taxation and the size of new firms evidence from europe using a novel country industry level panel database with information on newly incorporated firms in 17 european countries between 1997 and 2004 we study how taxation of corporate income affects the size of entrants at the country industry level our results that are robust to changes in several assumptions suggest that a reduction in the effective corporate income tax rate leads to a significant reduction of the capital size of entrants and to a decrease in their capital labor ratio

constitutional rules and fiscal policy outcomes we investigate the effect of electoral rules and forms of government on fiscal policy outcomes in a large sample of democracies we rely on different estimation methods to address prospective problems of statistical inference due to non random selection of these constitutional rules the findings are consistent with our theoretical priors presidential regimes induce smaller governments than parliamentary democracies while majoritarian elections lead to smaller governments and smaller welfare programs than proportional elections

varieties of entrepreneurship exploring the institutional foundations of different entrepreneurship types through varieties of capitalism arguments while entrepreneurship researchers agree that institutions matter for entrepreneurship they also have a rather encompassing understanding of institutions as almost any external factor that influences entrepreneurship ultimately this literature thus comes up with a long list of institutional factors that may explain entrepreneurial differences between countries but which institutions are most influential how do these institutions relate to different types of entrepreneurship and to what extent are institutions complementary to each other in the way they sustain different entrepreneurship types the literature on varieties of capitalism voc offers a parsimonious theoretical framework to address these questions based on the voc literature we theoretically derive a consistent set of institutional indicators that can explain differences in entrepreneurship types between countries based on principal component and cluster analyses we illustrate how 21 western developed economies cluster around four distinct institutional settings furthermore we use simple ols regressions to show how these institutional constellations are related to different types of entrepreneurship we conclude that four different varieties of entrepreneurship can be identified across the western world the main implication of our findings is that a perfect institutional constellation equally facilitating different types of entrepreneurship does not exist policy makers seeking to stimulate entrepreneurship are thus faced with the trade off of targeting policy reforms to that entrepreneurship type they intend to promote at the expense of other types of entrepreneurship and the broader societal consequences such reforms will have

new technology based firms in europe market penetration public venture capital and timing of investment we investigate the effect of public puvc and private prvc venture capital funds on the sales growth of 6513 european new technology based firms ntbfs during the period from 1992 to 2009 our results show that puvc backed ntbfs underperform with respect to prvc backed ones and do not grow more than non venture capital backed companies the impact of puvc is still not statistically significant even though it is positive when puvc funds target young ntbfs the only notable exception suggesting a positive and statistically significant impact for puvcs is when puvc funds cofinance with prvc funds and both target young firms

venture capital in europe and the financing of innovative companies european venture captial venture capital is considered to be the most appropriate form of financing for innovative firms in high tech sectors venture capital has greatly developed over the last three decades in the united states but much less so in europe where policy makers are striving to help channel more funds into this form of financial intermediation in this paper we provide the first assessment of venture capital in europe we document its development in the 1990s and compare it with that of american venture capital we find the wedge between them to be large and growing we then look at the involvement of venture capital with some of europe s most innovative and successful companies those listed on europe s new stock markets venture capital is effective in helping these firms overcome credit constraints and thus to be born in the first place using a unique hand collected data set from the listing prospectuses and annual reports of these companies we find european venture capital to have a limited effect on their ability to raise equity capital grow and create jobs we conclude that public support of the european venture capital industry should look at both its growth and at its maturation laura bottazzi and marco da rin

linking the price of agricultural land to use values and amenities the recent appreciation in agricultural land values across the united states has raised a number of important questions for farmers farmland owners lenders and policy makers while traditional economic theory suggests that farmland values are determined by the discounted stream of expected returns previous research has shown that agricultural land values are actually driven by a complex set of factors this study leverages the unique characteristics of a national land based usda survey on farmland values and cash rents to estimate broad national level determinants of the market value of cropland and pastureland our results support past research findings that indicate farmland values are only partially explained by agricultural returns we find that multiple nonagricultural attributes of farmland also contribute to the market value

economic and environmental effects of a co2 tax in latin american countries abstract the environmental extension from the leontief pricing model is used to simulate the economic and environmental effects of setting different co2 tax rates in three latin american countries brazil mexico and chile it considers a regulatory scenario in which the tax is applied only to emissions from the electricity sector and another scenario in which tax is applied to emissions from all economic sectors the results show that the effects of a co2 tax on sectoral prices and emissions in each country are very different for the same tax rate but these effects are similar in each country when comparing both regulatory scenarios this is explained by the composition carbonization of the electric generation and energy matrix of each of the countries which significantly affects the effectiveness of co2 taxes to reduce emissions in addition the economic sectors most affected by the different regulatory scenarios are similar in all countries

vegetable spirits and energy policy this study investigates the extent to which the 2005 energy policy act specifically the ethanol mandate contributed to the rise in farmland values we use the location of new ethanol plants to identify the capitalization effect of the mandate by these spatially advantaged operations we use a difference in difference propensity score matching estimator to control for the non random selection of ethanol production facilities the empirical strategy uses farmland parcel values from the 2001 7 june agriculture survey we find that new ethanol facilities had no effect on nearby farmland values prior to the mandate but had statistically significant effects after the policy copyright 2013 oxford university press

capital market imperfections high tech investment and new equity financing highly variable returns asymmetric information and a lack of collateral should cause small high tech firms to have poor access to debt new equity financing has several advantages over debt but may be costly compared to internal finance we examine an unbalanced panel of over 2 400 publicly traded us high tech companies over the period 1981 98 most small high tech firms obtain little debt financing new equity financing in the form of the initial public offering is very important and permits a major increase in firm size after going public comparatively few firms make heavy use of external finacing

financial and legal constraints to growth does firm size matter using a unique firm level survey database covering 54 countries we investigate the effect of financial legal and corruption problems on firms growth rates whether these factors constrain growth depends on firm size it is consistently the smallest firms that are most constrained financial and institutional development weakens the constraining effects of financial legal and corruption obstacles and it is again the small firms that benefit the most there is only a weak relation between firms perception of the quality of the courts in their country and firm growth we also provide evidence that the corruption of bank officials constrains firm growth

examining the use of national databases in a hedonic analysis of regional farmland values hedonic techniques have attracted the interest of economists as a means of measuring values of nonmarket goods by studying the market transactions of differentiated products such as automobiles and houses implied values and corresponding demand schedules can be estimated for underlying characteristics such as automobile safety features two car garages and air quality of residential neighborhoods the subject of this paper is farmland and estimating the values of characteristics such as soil productivity and erodibility in 1974 rosen and freeman independently developed theoretical models for differentiated consumer products that now serve as the basis for empirical estimates of marginal prices of product characteristics procedures to estimate demand schedules of underlying characteristics were outlined in palmquist 1984 palmquist 1989 further extended rosen s theoretical model to consider land as a differentiated factor

robust financial contracting and the role of venture capitalists we derive a role for inside investors such as venture capitalists in resolving various agency problems that arise in a multistage financial contracting problem absent an inside investor the choice of securities is unlikely to reveal all private information and overinvestment may occur an inside investor however always makes optimal investment decisions if and only if he holds a fixed fraction contract where he always receives a fixed fraction of the project s payoff and finances that same fraction of future investments this contract also eliminates any incentives of the venture capitalist to misprice securities issued in later financing rounds in this article we develop a model of financial contracting with multiple investment decisions and show how conflicts of interest and informational asymmetries can be effectively resolved by an inside investor i e an investor who not only provides capital but also works closely with the firm monitors it frequently and is generally very well informed about the firm s prospects and investment opportunities venture capitalists are obvious examples of inside investors and their function has been an important motivation for this article banks especially in japan and germany are also involved in monitoring and can be viewed as playing the role of inside investors in this article we examine the potential benefits of inside investors in a context where there are no restrictions beyond limited liability on the type of financial contracts that can be written we address a basic financial contracting problem involving an entrepreneur who has an idea for a project but does not have sufficient capital to fund it an important assumption is that there are several stages in the project s development and that a decision must be made at each stage whether the project should be continued or abandoned if the project is continued the amount of additional capital to be invested must also be determined we assume that the entrepreneur as an insider observes private information about the project s profitability at each stage this information is not

an evaluation of the swedish system of active labour market programmes in the 1990s we investigate the presence of short and long term effects from joining a swedish labor market program vis a vis more intense job search in open unemployment overall the impact of the program system is found to have been mixed joining a program has increased employment rates among participants a result robust to a misclassification problem in the data on the other hand it has also allowed participants to remain significantly longer on unemployment benefits and more generally in the unemployment system this being particularly the case for those entitled individuals entering a program around the time of their unemployment benefits exhaustion

application of computable general equilibrium cge to climate change mitigation policy a systematic review abstract with the growing literature related to climate change mitigation measures and policy interventions a systematic review of the application of computable general equilibrium cge model is inevitable therefore this article aims to characterise the relevant studies define a comparative framework to identify the current state of the art and the gaps in applied general equilibrium models firstly the systematic review found a total of 301 research articles from scopus and web of science databases and finally analysed 154 articles based on inclusion and exclusion criteria from 67 refereed journals the review analysis found that application of cge model is very vital in addressing climate change mitigation issues at the national regional and global levels however china attracted the most substantial research interests followed by the usa india and australia among others which are in line with their share of greenhouse gas emissions in the world most of the research themes focus on the carbon tax emission reduction target emission trading renewable energy energy efficiency and carbon capture and storage as primary drivers of low carbon economy nevertheless there is a trend of employing more static cge model compared to the dynamic cge although application of the latter has a limitation of providing right inputs to the macroeconomic policy finally research directions and gaps envision other complementary models such as dynamic stochastic general equilibrium dsge and agent based model abm for proper policy interventions

venture capital financing moral hazard and learning we consider the provision of venture capital in a dynamic agency model the value of the venture project is initially uncertain and more information arrives by developing the project the allocation of the funds and the learning process are subject to moral hazard the optimal contract is a time varying share contract which provides intertemporal risk sharing between venture capitalist and entrepreneur the share of the entrepreneur reflects the value of a real option the option itself is based on the control of the funds the dynamic agency costs may be high and lead to an inefficient early stopping of the project a positive liquidation value explains the adoption of strip financing or convertible securities finally relationship financing including monitoring and the occasional replacement of the management improves the efficiency of the financial contracting

factors that determine the reputation of private equity managers in developing markets abstract this paper analyzes the relationship between investors and private equity managers in order to identify the factors that affect the latter s reputation since there are no individual references about their past returns in developing private equity markets the reputation of such players is thought to be linked to their capacity for obtaining new funds results provide evidence of the volume of investments recorded in the past the ratio of portfolio companies to investment manager the percentage of divestments carried out through initial public offerings and trade sales the membership of the national private equity association and the size of funds under management as characteristics of the highest importance in raising funds

effects of the internalization of the social cost of global and local air pollutants in chile abstract in 2017 environmental taxes on global pollutants co2 and local air pollutants so2 nox and pm began to be collected to reduce emissions in chile however large emitting sources only are subject to environmental taxes and the tax rates are much lower than the social cost of these pollutants which does not allow to fully internalize the generated damages for the above this study uses the environmental extension of the leontief price model and microsimulations to estimate the economic environmental distributive and poverty short term effects associated with the application of pigouvian taxes on all emissions generated by productive activities the results show that currently there are too many resources allocated to activities that generate strong negative externalities mainly in the electricity and transport sectors specifically the emissions are reduced almost 10 times more than in the current tax scenario if environmental taxes equal to social costs are applied but relevant negative indirect effects are generated that make the practical application of a tax of these characteristics unrealistic for example there is a fall between 1 2 and 2 9 in employment slightly worsening the income distribution and increases the poverty rate between 0 9 and 2 3 percentage points

technology strategy and new venture performance a study of corporate sponsored and independent biotechnology ventures abstract new ventures companies eight years or younger play a major role in the development of an emerging high technology industry corporate sponsored new ventures those supported by an established corporation and independent ventures those founded by independent entrepreneurs frequently battle for industry leadership and financial success whereas both venture types use technology to achieve financial and market success little is known about the differences in their technology strategies technology strategy is the plan that guides a new venture s decisions on the development and use of technological capabilities this strategy covers six major areas the first is selecting the pioneering posture where a venture decides whether or not be among the industry s first companies to introduce new products technologies to the market the second is determining the number of products to be introduced to the market the third is choosing the extent of a venture s use of internal and external r d sources internal sources usually refer to in house r d activities external sources may include purchasing or licensing of technology from other companies or joining strategic alliances to acquire that technology the fourth is deciding the level of r d spending the fifth is selecting the combination portfolio of applied and basic research projects whereas basic r d advances science applied r d leads to new products and technologies the sixth and final dimension is the venture s use of patenting to protect any competitive advantages it might gain from its r d activities this article reports the results of a study that explored the differences in the technology strategies and performance of corporate and independent ventures the biotechnology industry was chosen to test the study s hypotheses using 112 ventures seven of the study s hypotheses focused on the potential variations in technology strategy between corporate and independent ventures independent ventures ivs were expected to surpass corporate ventures cvs in pioneering new products technologies using internal r d and emphasizing applied r d cvs were expected to surpass ivs in introducing new products using external r d sources spending on r d and patenting the study s remaining three hypotheses covered possible variations in new venture performance nvp and their sources the results showed that ivs focused more on pioneering pursued a more applied r d portfolio and emphasized internal r d more than cvs cvs utilized external technology sources spent more heavily on r d stressed basic r d and used patenting more intensively than ivs these results were consistent with the hypotheses however contrary to expectations there were no significant differences between cvs and ivs in the frequency of new product introductions probably because most ventures were at the invention rather than the commercialization stage the results on the nvp of cvs and ivs were counter to expectations ivs outperformed cvs probably because of the high motivation of the iv owners who reaped the rewards of growth and profitability also whereas cvs may have greater access to the resources of their sponsors political conflicts and rigid corporate controls might have reduced their ability to achieve competitive advantages the results also indicated that cvs and ivs appeared to gain competitive advantages from different technological choices pioneering a focus on applied r d and extensive use of the internal r d sources were also positively associated with the performance of ivs heavy r d spending the use of both internal and external r d sources frequent product introductions and patenting were positively associated with the performance of cvs finding that technology strategies significantly impacted nvp should encourage executives to consider pursuing a formal technology strategy likewise the finding that different dimensions of technology strategy influenced the performance of cvs and ivs in different ways has practical implications cv managers can learn from their higher performing iv rivals also because established companies frequently acquire ivs information about their technology strategies can be valuable in assimilating the acquired ventures overall the results show that technology strategy is an important factor in enhancing new venture performance

the reform of the european energy tax directive exploring potential economic impacts in the eu27 abstract the aim of this study is to analyze the effect that the energy tax directive reform proposed in 2011 would have if implemented on the level of prices in the different sectors of the 27 countries of the european union we apply a multiregional and multisectoral model of trade flows that takes into account all the intersectoral and intercountry interdependences in the production processes using the world input output database we perform two different simulations the first one considers the tax changes proposed by the reform the second one shows the impact the reform would have entailed if it were applied also to sectors belonging to the european trade system the main finding of the first simulation shows that the new energy tax regime would have had a low economic cost in terms of impact on prices less than 1 in all the countries so the concerns about competitiveness do not find empirical support in our results suggesting the need for further analyses to find out the reasons that caused the failure of a reform that was an important step to introduce a taxation explicitly linked to co 2 emissions the second simulation however leads to strongly different results pointing out the relevance of maintaining significant economic incentives to reduce carbon emissions for the european trade system sectors by improving the emission market performance or by applying carbon taxation also to these sectors

the effect of power plants on local housing values and rents abstract this paper uses restricted census microdata to examine housing values and rents for neighborhoods in the united states where power plants were opened during the 1990s compared to neighborhoods with similar housing and demographic characteristics neighborhoods within 2 miles of plants experienced 3 7 decreases in housing values and rents with some evidence of larger decreases within 1 mile and for large capacity plants in addition there is evidence of taste based sorting with neighborhoods near plants associated with modest but statistically significant decreases in mean household income educational attainment and the proportion owner occupied

effects and mechanism of influence of china s resource tax reform a regional perspective abstract china s resource tax reform beginning with xinjiang as a pilot area in june 2010 marked a new stage in the progression of china s resource tax system based on the 2007 social accounting matrix sam for xinjiang constructed by ourselves this paper takes a regional perspective on china s resource tax reform to quantitatively calculate its degree of influence and qualitatively analyze its mechanism of influence by adopting an energy computable general equilibrium cge model and a sam price model the results show that the main significance of the reform lies in bolstering local government finances rather than energy conservation or carbon reduction this is because revenue will be transferred from resource enterprises and the central government to the local government while simultaneously the low tax rate narrow tax scope and unreasonable price mechanism will combine to prevent the reform from reaching its environmental goals promoting resource price mechanism reform and deepening resource tax reform will be two key elements of china s future energy strategies because resource enterprises will bear the increased burden caused by the reform the degree of sectoral price increases will be limited therefore the fear that resource tax reform will push up inflation is unnecessary and should not be a barrier to reform

the regulation of labor author s botero juan djankov simeon la porta rafael lopez de silanes florencio shleifer andrei abstract we investigate the regulation of labor markets through employment collective relations and social security laws in 85 countries we find that the political power of the left is associated with more stringent labor regulations and more generous social security systems and that socialist french and scandinavian legal origin countries have sharply higher levels of labor regulation than do common law countries however the effects of legal origins are larger and explain more of the variation in regulations than those of politics heavier regulation of labor is associated with lower labor force participation and higher unemployment especially of the young these results are most naturally consistent with legal theories according to which countries have pervasive regulaory styles inherited from the transplantation of legal systems

skills or networks success and fundraising determinants in a low performing venture capital market abstract this paper provides a novel interpretation of the factors leading to low performance in venture capital vc markets by using human and social capital perspectives we investigate the relationship between the professional experience and education of vc firm managers and i the success of their portfolio firms on one hand and ii their fundraising activity on the other our study focuses on the french vc market the french business environment is characterized by tight links between businesses and the state and by powerful elite networks while the vc industry has been dominated by government funding and incentives since the global financial crisis we evidence a positive relationship between task specific human capital variables and the exit success of vc backed firms however unlike the research from the us market we find no support for the claim that success determinants impact fundraising activity instead we substantiate the importance of higher social networks for raising larger funds in markets with strong networks

venture capital and new business creation abstract using a comprehensive database of firms from 21 european countries over the period 1998 2008 we find that venture capital investment has a positive effect on the rate of new business creation this is especially true in countries with higher entry costs higher protection of intellectual property rights and lower taxes on capital gains our results suggest that controlling for country and industry characteristics venture capital is beneficial to bringing new ideas to the marketplace in the shape of new companies

the changing roles of urban influence and agricultural productivity in farmland price determination between 2000 and 2010 inflation adjusted u s farmland values increased by over 80 this period of rapid price appreciation coincided with both the agricultural commodity price boom and the broader financial crisis this paper examines the degree to which the determinants of farmland prices changed over this period using a panel of farmland transfer declarations from 98 illinois counties hedonic price analysis demonstrates that the relative importance of urban influence decreased over this period while the relative importance of agricultural productivity increased the study carries important implications for farmers farmland owners and policy makers

the impact of natural gas price control in china a computable general equilibrium approach abstract this paper depicts the natural gas price control behavior of the chinese government in an imperfect competition market structure using a static cge model it simulates the effect of changes in natural gas price control policy on carbon emission and the economic effects in view of demand side and supply side based on the above we also analyze the carbon emission mechanism from economic and energy structure perspective the results show that an increase in natural gas price can reduce carbon emission or tends to cause a long term decline in the surplus profit rate of the natural gas industry moreover the increase in natural gas price may raise the cpi and reduce actual gdp and residents welfare on the contrary a decrease in natural gas price may reduce cpi and enhance resident welfare however the long term actual gdp will not increase but carbon emission will increase and the surplus profit rate of the natural gas industry may reduce in the short term and increase in the long term on the other hand both increase and decrease in natural gas prices may result in a decrease of the actual gdp level in the long term the elimination of price control in natural gas supply may increase actual gdp and residents welfare and reduce cpi meanwhile it may increase carbon emissions and improve the profitability of the natural gas industry

lock in effect of emission standard and its impact on the choice of market based instruments abstract a country s existing emission standard policy will lead to a lock in effect when the country plans to adopt new market based instruments to control greenhouse gas emissions it must consider this effect as it chooses among instruments to avoid larger efficiency loss in this paper we find that the lock in effect will cause a kink point to occur on the marginal abatement cost mac curve this change of shape for the mac curve reminds us to be cautious in choosing market based instruments when applying weitzman s rule we also introduce this concept into a dynamic multi regional computable general equilibrium cge model for china and simulate mac curves for all regions after applying weitzman s rule we propose a timeline for introducing price instruments under different marginal benefit mb curve scenarios

the capital gap for small technology companies public venture capital to the rescue in this paper we analyze effectiveness of public intervention for fostering private venture capital market in spain we use a sample obtained from venturexpert database consisting of 755 investments made by 83 spanish public and private venture capitalists that closed at least one fund between 1997 and 2008 we compare the investments undertaken by private and public investors before and after public venture capital programs were started we found that spanish venture capital market has rapidly developed in the last 10 years and that this development coincides with the establishment of public policies for encouraging technology entrepreneurship we also found that other factors such as previous experience of investors and size have also contributed to fostering more high risk investments these results may encourage governments in other countries to start or keep working to promote private venture capital investments

the implications of the us renewable fuel standard programme for farm structure abstractwe investigate the impact of the 2005 renewable fuel standard rfs on farm structure particularly farm size we rely on the salience of a new ethanol plant in a farmers local neighbourhood to identify the impact of the rfs mandate on these spatially advantaged farms to control for the nonrandom selection of ethanol production facilities we utilize a propensity score matching estimator and to remove impact of farm level or market shifting unobservables resulting from shifts in commodity prices we employ a difference in difference dd matching approach we estimate the treatment effect of an ethanol production facility on farm size prior to the rfs mandate and after the rfs programme the effect of the rfs policy on farm size is obtained as the difference between these two dd matching estimators overall our results suggest that the rfs programme raised the probability of farm size increase by roughly 12 18 on average for farms located within a 30 mile radius of new ethanol plants in add

resource rent taxes and sustainable development a mongolian case study abstract economies rich in mineral resources need to evaluate the merits of investing rents earned from resource extraction in other income generating activities to sustain the flow of income it is hence important to estimate and assess the potential uses of the resource rent tax rrt this paper illustrates how the reinvestment of the rrt and other government revenue from mining can reduce the depreciation of the mine this illustration is made with reference to a coal deposit in the tavan tolgoi region of mongolia the paper also illustrates impact of mining on the macroeconomic performance of mongolia standard macroeconomic frameworks that ignore the depreciation of mineral assets overstate economic performance the paper also reviews the political issues and constraints that surround the implementation of the rrt one option canvassed here is the granting of qualified custodial rights of the rrt to the mining firm such qualified rights are pertinent given that the rrt is legally the income owed to the state and investments in ventures such as human capital development can yield returns as high as 10 per annum this study illustrates that even an investment option yielding an annual 3 return can make a significant difference

corporate hedging under a resource rent tax regime in addition to the ordinary corporate income tax special purpose taxes are sometimes levied to extract abnormal profits arising from the use of natural resources such dual tax regimes exist in norway for oil and hydropower where the corresponding special purpose tax bases are unaffected by any derivatives payments dual tax firms with hedging programs therefore face the risk of potentially large discrepancies between the tax bases for corporate income tax and special purpose tax i investigate how this tax base asymmetry influences the extent of hedging of value maximizing firms facing hedgeable as well as unhedgeable risk dual tax firms facing deadweight costs in low profit events generally demand less hedging than ordinary firms but otherwise respond similarly to characteristics of the underlying risk exposures the special purpose tax does not influence firms hedge portfolios in the absence of deadweight cost

what will china s carbon emission trading market affect with only electricity sector involvement a cge based study abstract on december 29 2017 china s carbon trading scheme ets was officially launched and it may be the largest emission trading platform in the world this paper establishes 5 counter measured scenarios based on the recently launched china s national ets market and constructs a dynamic recursive computable general equilibrium model to study the impact of national ets on the economy energy and environment we find that the national ets will have a negative impact on gdp by 0 19 1 44 the national ets can significantly increase the price of electricity however the increase in the prices of other commodities will be much lower than that of electricity as long as the mechanism of the ets market remains unchanged emission reduction per year will increase linearly economic output and co2 emission are sensitive to annual decline factor adf this paper argues that china s national ets market is an effective tool to reduce co2 emission and we suggest that adf could be 0 5 when allocating carbon allowance for the electricity sector this could balance economic output and co2 reduction also it is easy to achieve the goal of double control total amount and intensity in china

does acquiring venture capital pay off for the funded firms a meta analysis on the relationship between venture capital investment and funded firm financial performance abstract researchers and practitioners frequently propose that venture capital vc is an important resource to increase the performance of funded firms especially in environments of uncertainty in this paper we scrutinize these theoretical propositions following an evidence based research approach we synthesize 76 empirical samples on 36 567 firms we find a small positive performance effect of vc investment on funded firm performance however the effect vanishes if researchers control for industry selection effects furthermore we find that the performance effect mainly relates to firm growth while profitability is unaffected we also uncover that performance effects are reduced when the funded firms are very young or very mature in addition studies focusing on ipo events which constitute the majority of studies determine a substantially smaller performance effect we discuss theoretical implications and offer suggestions for future research on vc

the rise and fall of french ecological tax reform social acceptability versus political feasibility in the energy tax implementation process the french government has a 10 year history of negotiations with industry resulting in voluntary agreements on energy consumption when implemented these voluntary agreements produced very few results in terms of global reduction of greenhouse emissions politiques et management public 11 4 1993 47 hence the idea of an energy tax became increasingly attractive for many french decision makers ecological environmental tax reform etr should have been one of the major political decisions and successes of the past leftwing coalition government instead it became one of its major failures as the constitutional court decided to terminate the energy tax project in december 2000 through insights gleaned from focus groups and interviews with business people and decision makers an attempt is made to understand the failure of the energy tax project firstly decision makers lacked crucial information about public and business opinions and secondly there were conflicts between the relevant administrations the fuel revolts of 2000 ended any hope of resolving the conflicts and implementing etr which was ultimately found unconstitutional this paper examines the political controversies raised by the etr project and the reasons for its eventual collapse in the hope of contributing new understanding to the body of knowledge on the political difficulties of introducing environmental policy instruments

the impact of decoupled payments on u s cropland values an extensive literature has shown that various farm programs may influence the value of farmland but other studies have not examined the cropland price effects of direct or decoupled payments separate from countercyclical payments this study uses nationally representative confidential field level panel data with farmer reported per acre land values we analyze the impact of decoupled and other farm program payments on farmland values using a fixed effects model and controlling for various factors that influence farmland values we find that an additional dollar of decoupled payments has a large and statistically significant impact on farmland values of about 18 per acre these results are comparable with similar studies undertaken in europe

effects of policy characteristics and justifications on acceptance of a gasoline tax increase abstract many economists argue that increasing the gasoline tax is an effective way to reduce fuel consumption yet public support for such a tax increase has been rather low among us residents we performed eight survey experiments total n approximately 3000 to examine how selected policy characteristics and persuasive messages influence support for a gasoline tax increase several policy characteristics significantly increased support for a gasoline tax increase having the increase phased in over five years modestly increased support compared with giving the extra revenue to the us treasury s general fund both refunding the extra revenue equally to all american families and having this revenue used for energy efficient transportation strongly increased support support for a gasoline tax increase was not affected by the nature of the mechanism to achieve revenue neutrality most people supported a 20 cent per gallon tax increase to repair roads and bridges explaining how the gasoline tax increase would reduce fuel consumption slightly increased support for a gasoline tax increase but neither being informed of the high gasoline prices in other advanced industrial countries nor the actual pump price of gasoline at the time of the experiment influenced support for a gasoline tax increase

small and medium sized enterprises bank relationship strength and the use of venture capital we investigate the nexus between small and medium sized enterprises smes use of venture capital and bank financing relationships using a unique data set with detailed information on sme finance in italy germany and the uk the empirical regularities we uncover show that that entrepreneurial firms substitute venture capital for multiple banking relationships this substitution effect is primarily driven by expertise substitution and there is also some suggestive yet inconclusive indication in the data that smes turn to providers of venture capital to avoid rent extracting behavior by the firm s main bank our results do not support the view that firms obtain venture capital in instances when bank financing is difficult to obtain instead venture capital funds are used if bank funding is deemed not appropriate and firms do seem to be aware of which type of financing is more appropriate for them

venture capital entrepreneurship and economic growth abstract using a panel of u s metropolitan areas we find that increases in the supply of venture capital positively affect firm starts employment and aggregate income our results remain robust to a variety of specifications including ones that address endogeneity the estimated magnitudes imply that venture capital stimulates the creation of more firms than it funds which appears consistent with two mechanisms first would be entrepreneurs anticipating financing needs more likely start firms when the supply of capital expands second funded companies may transfer know how to their employees thereby enabling spin offs and may encourage others to become entrepreneurs through demonstration effects

the effect of agricultural policy on farmland values the extent to which agricultural support programs have been capitalized into farmland prices has been examined in this study a present value land price model was developed which decomposes returns to the land base into its two possible sources farm production and government subsidies and allows the discount rates associated with these two income sources to vary the empirical results indicate that government payments are discounted less than marketbased returns in ontario thus government payments have been viewed as a more stable source of income to ontario farm operators during the last half century than market based returns

are financial development and corruption control substitutes in promoting growth abstract while financial development and corruption control have been studied extensively their interaction has not we develop a simple model in which low corruption and financial development both facilitate the undertaking of productive projects but act as substitutes in doing so the substitutability arises because corruption raises the need for liquidity and thus makes financial improvements more potent conversely financial underdevelopment makes corruption more onerous and thus raises the gains from reducing it we test this substitutability by predicting growth of countries and industries using measures of financial development lack of corruption and a key interaction term both approaches point to positive effects from improving either factor as well as to a substitutability between them the growth gain associated with moving from the 25th to the 75th percentile in one factor is 0 63 1 68 percentage points higher if the second factor is at the 25th percentile rather than the 75th the results show robustness to different measures of corruption and financial development and do not appear to be driven by outliers omitted variables or other theories of growth and convergence

financing technology based small firms in europe what do we know this paper reviews the evidence on financing technology based small firms tbsfs in europe european tbsfs finance new investments by relying primarily on internal funds due to capital market failures induced by asymmetric information european venture capital has caught up with us venture capital but this is mainly because of the growth in uk venture investments it is unclear whether european venture capital has been able to certify the quality and enhance the growth of funded companies compared with the nasdaq there is little development of trading in high tech stocks in europe the so called new markets established in the 1990s collapsed in the wake of the internet bubble crash public venture capital and research and development r d tax incentives seem to have positively affected high tech firms

ipos trade sales and liquidations modelling venture capital exits using survival analysis using a detailed sample made up of more than 20 000 investment rounds we analyze the time to ipo trade sale and liquidation for about 6 000 venture backed firms we model these exit times using competing risks models biotech and internet firms have the fastest ipo exits internet firms are also the fastest to liquidate while biotech firms are however the slowest the conditional probability for ipos are clearly non monotonous with respect to time as time flows venture capital backed firms first exhibit an increased likelihood of exiting to an ipo however after having reached a plateau investments that have not yet exited have fewer and fewer possibilities of ipo exits as time increases the bubble period from 1998 to 2000 was an easy money period where venture capitalists gave much more money to firms many of which did not offer outstanding growth potential as they tended to liquidate much faster than in normal times

venture capitalist certification in initial public offerings this paper provides support for the certification role of venture capitalists in initial public offerings consistent with the certification hypothesis a comparison of venture capital backed ipos with a control sample of nonventure capital backed ipos from 1983 through 1987 matched as closely as possible by industry and offering size indicates that venture capital backing results in significantly lower initial returns and gross spreads in effect the presence of venture capitalists in the issuing firms serves to lower the total costs of going public and to maximize the net proceeds to the offering firm in addition we document that venture capitalists retain a significant portion of their holdings in the firm after the ipo the ability of third party specialists to certify the value of securities issued by relatively unknown firms in capital markets that are characterized by asymmetric information between corporate insiders and public investors has attracted much academic interest in recent years several authors including james 1990 blackwell marr and spivey 1990 and barry muscarella peavy and vetsuypens 1991 have developed and tested models based at least in part on the formal certification hypothesis presented in booth and smith 1986 a related body of work represented by deangelo 1981 beatty and ritter 1986 titman and trueman 1986 johnson and miller 1988 carter 1990 simon 1990 and carter and manaster 1990 has examined how investment bankers and auditors help resolve the asymmetric information inherent in the initial public offering ipo process in this paper we examine whether the presence of venture capitalists as investors in a firm going public can certify that the offering price of the issue reflects all available and relevant inside information we hypothesize that venture capitalists can perform this function that it will be an economically

default and renegotiation a dynamic model of debt we analyze the role of debt in persuading an entrepreneur to pay out cash e ows rather than to divertthem in the e rstpartof the paper we study the optimal debt contract specie cally the trade off between the size of the loan and the repayment under the assumption that some debt contract is optimal in the second part we consider a more general class of nondebt contracts and derive sufficient conditions for debt to be optimal among these

the importance of equity finance for r d activity this article analyzes the importance of equity finance for the r d activity of small and medium sized enterprises we use information on almost 6 000 german smes from a company survey using the intensity of banking competition at the district level as an instrument to control for endogeneity we find that a higher equity ratio is conducive to a higher r d intensity owners may only start r d activities if they have the financial resources to sustain them until successful completion we find a larger influence of the equity ratio for young companies equity may be more important for young companies which have to rely on the original equity investment of their owners since they have not yet accumulated retained earnings and can rely less on bank financing

how china s current carbon trading policy affects carbon price an investigation of the shanghai emission trading scheme pilot abstract to better establish a unified carbon market in china this study evaluates the effect of current carbon trading policy and further investigates the relationship between such policy that is published during the second phase of shanghai environment and energy exchange seee and shanghai emission allowance shea price we aim to analyze whether these policies can improve the operation efficiency of current carbon market by the mean reversion test cox ingersoll ross cir model and event study method we first analyze the potential price discovery function of shea products thereby describing the transmission channel of current policy to shea price then we examine the effect of carbon policies published in different periods on their corresponding shea price by the auto correlation test and cir simulation we find that 3 4 of all auto correlation values are less than 0 after apr 2017 and the minimum cumulative error is 31 3792 under the supply and demand channel these findings imply that shea price has the discovery function at the middle and end of trading period and the current policy affects shea price through its effect on the fundamentals of supply and demand further more than 60 of all r values r value that reflects the response of price to policy are less than 1 which implies that the published policy will improves future shea price accordingly we argue that seee belongs to a policy oriented market and the change of carbon price is closely related to emission allocation policies in this case china s government should further push forward the smooth operation of current carbon market by the aid of incentive policy in the coming period

how does tax system on energy industries affect energy demand co2 emissions and economy in china abstract energy savings and co2 emission reduction have become a major issue in recent years taxes on energy production sectors may be an effective way to save energy reduce co2 emissions and improve environmental quality this paper constructs a dynamic recursive computable general equilibrium cge model to analyze the impact of the energy tax on energy economy and environment from the perspective of tax rates and tax forms specific tax and ad valorem tax the results show that adjusting the tax system and the tax rate has important implications for energy conservation while having minor impacts on the output of other industries the impact of an increasing energy tax on the energy demand is greater than the impact on sectoral output indicating that energy efficiency will be increased to some extent the co2 reduction will increase over time when an ad valorem tax is implemented on enterprises we found that ad valorem tax has greater elasticity of economic output energy demand and co2 emission reduction the results support the direction of china s resource tax reform however we argue that it is better to increase the tax rate relatively and relax the control on energy prices so that energy efficiency will increase