Research On Geographic Agglomeration Effect Of Venture Capital Based On Spatial Panel Model

Venture Capital(VC) originated in the United States since 1940 s. Venture Capital has been popular in the U.S., Europe, Japan and other developed countries for many years, and now also has been quickly developed in many emerging developing countries, such as China, Brazil and India. Either Venture Capital funds or Venture Capital firms get together in certain region or city, even in a certain building. We call this a phenomenon of Venture Capital’s geographical agglomeration. The degree of Venture Capital’s geographical agglomeration is different in each region. So will be its effect to the economic development and technological innovation. Therefore, the research of Venture Capital’s geographical agglomeration effect is necessary.This paper made the analysis the current situation of Venture Capital’s geographical agglomeration status from three aspects. They are the Venture Capital institutions, the Venture Capital funds and venture capital geographical agglomeration index. After the establishment of venture capital geographical agglomeration, there will have an impact on the regional economic development level, the technological innovation level and the human resources level. We use the 2009~2013 panel data of China in 30 provinces, municipality and autonomous districts except Tibet autonomous region to carry out the empirical analysis. At the same time, we study the role of venture capital geographical agglomeration on economic development level and the science and technology innovation level.This paper has 3 hypothesis. Hypohesis 1 is that the venture capital geographical agglomeration will promote the region’s economic development level. Hypohesis 2 is that the venture capital geographical agglomeration will promote the science and techonology innovation level. Hypohesis 3 is that the venture capital geographical agglomeration will promote the human resources level.Through the empirical analysis, the human resources level is not pass through the Granger causality test, so Hypothesis 3 is not valid. The economic development leveland science and technology innovation input pass through the Granger causality test and spatial autocorrelation test. This paper use the space Doberman individual fixed effects model to estimates respectively of venture capital geographical agglomeration’s different role on economic development level and innovation input.The conclusions as following:(1) Venture capital geographical agglomeration’s direct and indirect effect on the economic development level are positive, that means the local venture capital geographical agglomeration can promote the region economic development, the adjacent areas venture capital geographical agglomeration can also promote the region economic development.(2) Venture capital geographical agglomeration’s direct and indirect effect on the innovation inputs are positive, that means the the local venture capital geographical agglomeration can promote the region innovation inputs, the adjacent areas venture capital geographical agglomeration can also promote the region innovation inputs.