Private Equity and Industry Performance

The growth of the private equity industry has spurred concerns about its impact on the economy. This analysis looks across nations and industries to assess the impact of private equity on industry performance. We find that industries where private equity funds invest grow more quickly in terms of to...

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Bibliographic Details
Published in:Management science 2017-04, Vol.63 (4), p.1198-1213
Main Authors: Bernstein, Shai, Lerner, Josh, Sorensen, Morten, Strömberg, Per
Format: Article
Language:English
Subjects:
cross-country analysis
Employment
Equity
Equity funds
Growth
Industry forecasts
industry growth
Investment companies
Private equity
Private equity funds
production
Robustness
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Summary:The growth of the private equity industry has spurred concerns about its impact on the economy. This analysis looks across nations and industries to assess the impact of private equity on industry performance. We find that industries where private equity funds invest grow more quickly in terms of total production and employment and appear less exposed to aggregate shocks. Our robustness tests provide some evidence that is consistent with our effects being driven by our preferred channel. This paper was accepted by Amit Seru, finance .
ISSN:0025-1909
1526-5501
DOI:10.1287/mnsc.2015.2404