Jump to ContentJump to Main Navigation
Show Summary Details
In This Section

Studia Universitatis „Vasile Goldis” Arad – Economics Series

4 Issues per year

Open Access
Online
ISSN
2285-3065
See all formats and pricing
In This Section

What Drives Private Equity Investments in Romania?

Mihai Precup
  • Ph.D. Student, University of Paris 1: Pantheon-Sorbonne, France
  • Email:
Published Online: 2015-11-26 | DOI: https://doi.org/10.1515/sues-2015-0025

Abstract

This paper aims at presenting the determinants of private equity investments in Romania over the period 2000 - 2013. Additionally, this paper presents the main highlights in terms of evolution, source of funding and activities in which the private equity funds invested during the crisis. Starting from the existing literature, this paper extends the analysis of private equity drivers to Romanian market by including variables such as: economic growth, market capitalization, interest rate, unemployment rate and public R&D expenditure which were already tested in previous papers. In addition, this paper introduces new variables such us productivity and corruption index which we consider important factors in explaining the evolution of private equity investments in Romania.

The results of our empirical model confirmed existing hypothesis regarding the importance of some determinants such as: unemployment rate, economic growth, market capitalization and corruption. Based on our empirical results, we have pointed several strategic directions that are meant to support the development of the private equity market in Romania. Keywords: private equity; economic growth; market capitalization; unemployment rate; corruption; private equity determinants; Romania.

Keywords: private equity; economic growth; market capitalization; unemployment rate; corruption; private equity determinants; Romania

References

  • 1. Black, B. and Gilson, R. (1998). „Venture Capital and the Structure of Capital Markets: Bank versus Capital Markets”, Journal of Financial Economics, p. 243-277. [Crossref]

  • 2. Bourbonnais, R. (2000) „Econométrie”, DUNOD, p.201 - 222.

  • 3. Breusch T. S. (1978), "Testing for Autocorrelation in Dynamic Linear Models". Australian Economic Papers, p.334-355. [Crossref]

  • 4. Cherif, M. (2009) „Public institutions and venture capital in Europe: a crosscountry panel data analysis”, Reims University Working Paper.

  • 5. Cherif M. and Gasdar K. (2009), „What drives venture capital in Europe? A cross-country panel data analysis”, International Journal of Public Management Performance, p.112-130.

  • 6. Durbin J. and Watson G. S. (1950), „Testing for Serial Correlation in Least Squares Regression, I", Biometrika 37, p.409-428.

  • 7. Durbin J. and Watson G. S. (1951), „Testing for Serial Correlation in Least Squares Regression, II", Biometrika 38, p.159-179. [Crossref]

  • 8. Elisabete G. et al. (2007) „The Determinants of Venture Capital in Europe - Evidence Across Countries”, Published by CEFAGE, p.3-32.

  • 9. EVCA (2014), „European Private Equity Activity 2013” Report. Available: www.evca.eu. Consulted in September 2014.

  • 10. Felix E., Gulamhussen M. A. and Pires C.P., (2007), „The determinants of venture capital in Europe evidence across countries”, Published by CEFAGE UE, p.11 -25.

  • 11. Godfrey, L. G. (1978), „Testing Against General Autoregressive and Moving Average Error Models when the Regressors Include Lagged Dependent Variables", Econometrica, p.1293-1301. [Crossref]

  • 12. Gompers P. & Lerner J., (1990), „The Determinants of Corporate Venture Capital Success: Organizational Structure, Incentives, and Complementarities”, NBER Working Paper, no 6725.

  • 13. Gompers, Paul A. (1996) „Grandstanding in the Venture Capital Industry.” Journal of Financial Economics, p. 133-156. [Crossref]

  • 14. Gompers P. & Lerner J., (1998), „What Drives Venture Capital Fundraising?”, Brooking Papers on Economic Activity, Macroeconomics, p. 149-192.

  • 15. Gompers P. & Lerner J. (2001), „The Venture Capital Revolution”, Journal of Economic Perspectives, p.145-168. [Crossref]

  • 16. Gompers P., Lerner J., Kovner A. and Scharfstein D. (2005) „The Venture Capital Revolution”, Journal of Economic Perspectives, p.145-168.

  • 17. Gompers, Paul A., Victoria Ivashina, and Joris Van Gool. (2013) „Note on LBO Capital Structure.” Harvard Business School Module Note, p.214-239.

  • 18. Hurlin C. (2012) „L’Econometrie des Données de Panel - Modéles Linéares Simples”, Ėcole Doctorale Edocif.

  • 19. Jagwani S., (2000), „Supply and demand of venture capital in the US”, The Park Place Economist, p. 90-98.

  • 20. Jeng L. & Wells P., (2000), „The Determinants of Venture Capital Funding : Evidence Across Countries”, Journal of Corporate Finance, p. 241-289. [Crossref]

  • 21. Kortum S. & Lerner J., (2000), „Assessing the Contribution of Venture Capital to Innovation”, Rand Journal of Economics, p. 674-692 [Crossref]

  • 22. Marti and Balboa (2001), „The determinants of private equity in fundraising western Europe”, Working paper.

  • 23. Romain A. & de la Potterie B.V.P., (2004), „The determinants of venture capital : a panel data analysis of 16 OECD countries”, Published by Research Institute in Management Science, p.10 - 35.

  • 24. White H. (1980), „A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity”, Econometrica 48, p.817-838. [Crossref]

About the article

Received: 2015-08-01

Accepted: 2015-10-01

Published Online: 2015-11-26

Published in Print: 2015-11-01



Citation Information: Studia Universitatis „Vasile Goldis” Arad – Economics Series, ISSN (Online) 1584-2339, DOI: https://doi.org/10.1515/sues-2015-0025. Export Citation

© 2015. This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License. (CC BY-NC-ND 4.0)

Comments (0)

Please log in or register to comment.
Log in