Essays in empirical corporate finance

Yin, Xiang (2022) Essays in empirical corporate finance. PhD thesis, London School of Economics and Political Science.

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Abstract

The aim of my thesis is to apply empirical methods to investigate corporate finance questions. In the first chapter, I investigate an unexplored role of venture capital (VC) investors on innovation: the potential value-add of due-diligence for firms involved in failed VC fundraising campaigns— i.e., startups that do not receive investment from the VC doing due diligence. We show that assignment to due-diligence leads to substantial increases in startup growth within two years of application, even for firms involved in failed fundraising campaigns. This new evidence implies that VCs' role in innovation affects many more firms than existing research has fully recognized, as it goes beyond their value-added effects on the portfolio companies in which they invest. In the second chapter, I collected a novel data set of the local planning applications in London and measure the quality of government by the speed of processing applications. I show causal evidence that the quality of local government can affect the households and firms’ activities in housing markets and borrowing behaviors. The effects arise because the timing of property development is important to households and firms. The delay in planning permission will lead them to abandon the project and change behaviors in housing markets and borrowing. In the third chapter, I study the purchasing behaviors of council governments in England and the impacts on the supplier firms. Due to political motivations, council governments’ purchasing patterns and procurement contract terms with local firms are different from that with nonlocal firms. Consequently, selling more goods and services to the local council government relative to other council governments results in more corporate investment.

Item Type:	Thesis (PhD)
Additional Information:	© 2022 Xiang Yin
Library of Congress subject classification:	H Social Sciences > HG Finance
Sets:	Departments > Finance
Supervisor:	Paravisini, Daniel and González- Uribe, Juanita and Axelson, Ulf
URI:	http://etheses.lse.ac.uk/id/eprint/4433

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