Innovation, technology and risk capital

The objective of this paper is to offer a microeconomic contribution to the policy debate over US industry performance.

The focus is on the interplay of innovation, technology, and risk capital, as well as on the strategic lessons this interplay might offer to European companies. The time frame extends from 1995, the advent of the “Internet revolution”, to 2000, the collapse of the dotcom valuations. This study may be viewed in two ways. In terms of theoretical frameworks, the emphasis is on the microeconomic determinants of success. Empirically, the study focuses on the role of the US technology sector and worldwide venture capital developments in the past two decades, but the focus is on the latter half of the 1990s.