Private Equity

This course is issue oriented. The main question is: What is the contribution of the capital market to innovation in the economy? The focus is on two special purpose financial intermediaries; private equity and venture capital funds. We discuss and analyze the operations of the funds, their relations with the investors, limited partners, and with the users of the funds, entrepreneurs. We also examine the funds in a broader macro-economic and financial context.

The course mixes conceptual presentation, empirical tests and observations, and practical "hands on" techniques. It takes materials from financial economics, from international finance, from development economics and international trade, and from the practice of private equity and venture capital funds. The various papers assigned as readings are not parts of a textbook, most of them are research papers. Yet, in the class we focus on the managerial aspects as well to create an integrated view of what private equity and venture capital finance is all about.