FINNOV

In this state of the art report we review the key literature supporting FINNOV’s work programme in order to understand the trajectory of research in the areas of finance innovation and growth. Much of the current debate on financing of innovative companies in Europe is based on models and data derived from experience in the USA, leading to recommendations intended to promote convergence on US structures and practice. We argue that there is now powerful evidence to suggest that the European situation is in fact different, and that Europe therefore needs to develop its own approach, adapted to its own circumstances. In this review we highlight empirical evidence and theoretical models to underpin the evolution of a distinctive and self-confident European approach to the financing of innovative businesses.