VC and employment

New research from Dr Horst Feldmann at the University of Bath on relations between the availability of venture capital in various industrial countries, and employment statistics:
The study estimates that if venture capital availability in Italy, where it was most difficult to obtain during the sample period, had matched the United States, where it was in best supply, Italy’s unemployment rate might have been 1.8 percentage points lower; its long-term unemployment share 9.0 percentage points lower; and its employment rate 2.7 percentage points higher.
On average over the sample period, venture capital availability was rated 3.1 in Italy and 5.8 in the United States on a scale of 1 to 7. The United Kingdom was rated at 5.3.

The exact methodology may be questionable - data on the availability of VC is taken from surveys of business executives (the World Economic Forum’s annual ExecutiveOpinion Surveys), so seems likely to have some subjective element. Feldmann does say, in the full paper (published in Kyklos) that the survey data can 'permit better coverage of the various facets of venture capital financing than hard data'. But, when tested against data on 'venture capital investment as per mil of average GDP', the correlation coefficient is just 0.29.

That aside, it's an interesting paper that will doubtless be welcomed by BVCA, EVCA, et al, as they argue against extra regulation.