Plausibly Exogenous - Innovation Spillovers (08/05/2021)
LHS Variable
Firm innovation
RHS Variable
Local capital availability
Source of Exogenous Variation
Instrument the amount of VC capital available locally using variation in the size of state pension funds. Because state pension funds invest disproportionably in local investment funds, such as private equity and venture capital funds, local investment funds raise capital more easily when local pension pools are larger (Gonzalez-Uribe, 2020).
- Matray (2021), “The local innovation spillovers of listed firms”