An Empirical Study Of Venture Capital's Promotion Of Regional Economic Growth

With China's economy entering the new normal,which requires innovation as one of the major engines of economic growth.Venture capital is able to take the responsibility.This article illustrates that venture capital plays a pivotal role in threeaspects,including the innovation ability of enterprise,the upgrade of industry,and the regional economic growth.Based on the resources that venture capital could bring to the invested companies,such as the no interest capital,the rich experience and the sophisticated board who is capable of leading the company to be successful,venture capital influences the innovative ability of the invested enterprises.Based on the relationship between high-tech industry and industry revolution,venture capital who is good at transferring the theories into the products,has an influence on the upgrade of industry,which could benefit the industry chain through the spillover effect and the imitation effect.Based on the investment in high-tech companies,venture capital exerts an influence on regional economic growth.The progress of technology is an essential part of economic growth.Venture capital,who help the development of high-tech companies,stimulates R&D.As a financial intermediary,it enriches regional financial structure,distributing the resources to the medium-sized and small enterprises.In the empirical analysis,I analyze the 3 assumption from the above proposals.Assumption 1:the development of venture capital has a positive effect on the regional economic growth.Provided that we enlarge the investment capital of VC,the growth rate of personal gdp will increase.Assumption 2:the development of venture capital could promote the upgrade of industry.With the increase of venture capital,the proportion of the industry will change.Assumption 3:among the economic growth,venture capital and R&D,there exists a fluctuation relationship and a transitive relationship.Then,in assumption 1,after regressing the macroeconomic data of 29 provinces in China,ranging from 2003 to 2013 and discussing whether adding a dummy variable of Growth Enterprises Market,I find that the development of venture capital has a positive relationship with regional economic growth.In assumption 2,1 use thedata of 29 provinces in China,ranging from 2007 to 2013,come to the conclusion that venture capital may not significantly alternates the proportion of the industry and interfere the upgrade of industry.In assumption 3,adopting the year data from 2001 to 2015,I construct the VAR model,analyze the fluctuation relationship among the amount of venture capital's investment,R&D,and economic growth.The result tells us that the fluctuation of venture capital's growth rate has a positive effect on the fluctuation of economic growth.But it is not significant on the fluctuation of R&D growth rate.So,VC's influence on the companies is limited.In the end of the dissertation,the result passes the robust analysis.