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Evolutionary interpretation of venture capital policy in Israel, Germany, UK and Scotland

Avnimelech, G   Rosiello, A   Teubal, M

Science and Public Policy   37 (2) 101-112

March 2010

http://spp.oxfordjournals.org/content/37/2/101.short

Despite many attempts to develop high-impact venture capital (VC) policies, most VC markets in Europe are still underdeveloped. Many of these policies were based on 'traditional' (Rosiello et al, 2009) VC policy involving a mix of monetary incentives and institutional changes. In this article, we present an alternative evolutionary VC policy, which is based on a dynamic analysis of emergence processes and on the co-evolution between VC and entrepreneurship, as well as on a dynamic and adaptive view of policy.

The article presents four case studies of VC development: Israel, UK, Scotland, and Germany. Evolutionary VC policies rely on few major factors: i) a strategic objective and a long-term commitment to enhancing VC market and high-tech cluster emergence and development, ii) a phased-policy portfolio including both direct and indirect VC-policy components, and iii) a dynamic policy process, which is adaptive to the specific context.