The macroeconomic determinants of private equity investment: a European comparison

$53.29 plus tax (Refund Policy)

Buy Article:

Abstract:

A strong private equity (PE) market is a cornerstone for commercialization and innovation in modern economies. However, substantial differences exist in the relative amounts raised and invested in PE across European countries. We investigate the macroeconomic determinants of PE investment in Europe, focusing on the comparison between Central and Eastern European (CEE) and Western European countries. Our estimations are based on a data set running from 2001 to 2011 that covers 16 countries. Applying robust estimation techniques, we identify a ‘robust’ set of determinants of PE activity in both regions. We find similarities as well as differences in the driving forces of PE investments in Western European and CEE countries. Our results suggest that economic activity, the inflation rate, equity market capitalization, unit labour costs, the unemployment rate as well the the institutional and legal environment are significant determinants of PE activity.

Keywords: C23; C52; E22; G24; extreme bounds analysis; private equity

Document Type: Research Article

DOI: http://dx.doi.org/10.1080/00036846.2013.866306

Affiliations: 1: DIW Berlin, Mohrenstraβe 58, 10117, Berlin, Germany 2: University of Hamburg, Welckerstr. 8, 20146, Hamburg, Germany

Publication date: April 13, 2014

More about this publication?
Related content

Share Content

Access Key

Free Content
Free content
New Content
New content
Open Access Content
Open access content
Subscribed Content
Subscribed content
Free Trial Content
Free trial content
Cookie Policy
X
Cookie Policy
ingentaconnect website makes use of cookies so as to keep track of data that you have filled in. I am Happy with this Find out more