TY  - UNPD
A1  - Gözlügöl, Alperen Afşin
A1  - Greth, Julian
A1  - Tröger, Tobias
T1  - The oscillating domains of public and private markets
N2  - We contribute to the debate about the future of capital markets and corporate finance, which has ensued against the background of a significant boom in private markets and a corresponding decline in the number of firms and the amount of capital raised in public markets in the US and Europe.
Our research sheds light on the fluctuating significance of public and private markets for corporate finance over time, and challenges the conventional view of a linear progression from one market to the other. We argue instead that a more complex pattern of interaction between public and private markets emerges, after taking a long-term perspective and examining historical developments more closely.
We claim that there is a dynamic divide between these markets, and identify certain factors that determine the degree to which investors, capital, and companies gravitate more towards one market than the other. However, in response to the status quo, other factors will gain momentum and favor the respective other market, leading to a new (unstable) equilibrium. Hence, we observe the oscillating domains of public and private markets over time. While these oscillations imply ‘competition’ between these markets, we unravel the complementarities between them, which also militate against a secular trend towards one market. Finally, we examine the role of regulation in this dynamic divide as well as some policy implications arising from our findings.
T3  - LawFin Working Paper - No. 52 
T3  - SAFE working paper - No. 384 
T3  - European Corporate Governance Institute - Law Working Paper - No. 689/2023 
KW  - corporate finance
KW  - capital markets
KW  - public markets
KW  - private markets
KW  - private equity
KW  - securities regulation
KW  - financial regulation
Y1  - 2023
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/68213
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-682134
UR  - https://ssrn.com/abstract=4372011
N1  - We gratefully acknowledge research support from the Leibniz Institute for Financial Research SAFE and the Center for Advanced Studies Foundations of Law and Finance funded by the German Research Foundation (Deutsche Forschungsgemeinschaft, DFG) - project FOR 2774.
VL  - March 2023
PB  - Center for Advanced Studies on the Foundations of Law and Finance, House of Finance, Goethe University
CY  - Frankfurt am Main
ER  -