Essays on Economics of Investment and Lending

Thumbnail Image
Journal Title
Journal ISSN
Volume Title
School of Business | Doctoral thesis (article-based)
Degree programme
22 + app. 120
Aalto University publication series DOCTORAL THESES, 5/2022
This dissertation consists of three separate essays. In the first essay, I estimate the effect of venture capitalists' advice (measured by time) on the outcomes of their portfolio companies using data on Finnish companies receiving venture capital. I utilize the limitedlife -pan of venture funds to instrument venture capitalists' advice intensity. My results show that venture capitalists positively impact the growth rate of employment and sales of their portfolio companies. In the second essay (jointly with Marta Giagheddu and Marco Casiraghi), we study Italian banks' behavior during the sovereign debt crisis of 2011. We use the crisis as a natural experiment to study how the banks behaved during these unusual times. Our results suggest that government debt crowded-out SME lending during the financial market dryout (7-12/2011), but the ECB's intervention (1/2012 onwards) restored lending conditions to the pre-crisis levels. In the third essay, I study how misalignment of stockbroker's and investor's incentives influence the market outcomes. Stockbrokers use stock information to optimize the portfolios they manage, but they also distribute this information to their clients. I construct a model to study the agents' decisions and find that if a broker has a scale advantage in doing research compared to its clients there can be situations when a client should use the information from a broker even though the client knows that the incentives are not aligned.
Supervising professor
Toivanen, Otto, Prof., Aalto University, Department of Economics, Finland
Thesis advisor
Murto, Pauli, Prof., Aalto University, Finland
venture capital, instrumental variable, sovereign debt, crisis, stockbroker
Other note
  • [Publication 1]: Timo Autio: The Influence of Active Ownership − Evidence from Venture Capital In- vestments in Finland. Unpublished manuscript
  • [Publication 2]: Timo Autio: Bank Lending and Sovereign Debt Availability. Unpublished manuscript
  • [Publication 3]: Timo Autio: Should You Listen to Your Broker? Unpublished manuscript