The reallocation effects of COVID-19: evidence from venture capital investments around the world
Chapter
Publication Date:
2020
abstract:
We examine possible reallocation effects on venture capital (VC)
investment due to the spread of COVID-19 around the globe. Exploiting
the staggered nature of the pandemic and transaction-level data,
we empirically document a shift of venture capital towards deals in
pandemic-related categories. A difference-in-differences analysis
estimates significant increases in invested amount and number of deals
in such categories. We further highlight several heterogenous effects
related to the experience of VC investors, their organizational form, and
country of origin. Our results underscore the link between the spread of
the pandemic and the functioning of the VC market around the world.
investment due to the spread of COVID-19 around the globe. Exploiting
the staggered nature of the pandemic and transaction-level data,
we empirically document a shift of venture capital towards deals in
pandemic-related categories. A difference-in-differences analysis
estimates significant increases in invested amount and number of deals
in such categories. We further highlight several heterogenous effects
related to the experience of VC investors, their organizational form, and
country of origin. Our results underscore the link between the spread of
the pandemic and the functioning of the VC market around the world.
Iris type:
Capitolo di Libro
List of contributors:
Bellucci, A; Borisov, A; Gucciardi, G; Zazzaro, A
Book title:
COVID ECONOMICS