Wissensmanagement in Private Equity-Netzwerken und die Rolle regionaler Finanzzentren

• Applicant: Professorin Dr. Britta Klagge
• Subject Area: Human Geography
• Term: from 2008 to 2010
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 51831288

There has been an ongoing debate on how the geographical organization of the financial sector has an impact on the provision of finance, especially to small and medium-sized enterprises (SMEs) and thus on regional development. The research project will explore a fresh perspective on this issue by looking at the ways in which financial service providers manage knowledge and risk in a regionally and internationally comparative perspective. It is our assumption that this geographically oriented “knowledge perspective” helps to better understand the sometimes contradicting trends in SME finance. We want to explore this new perspective by examining knowledge management in the private equity (PE) business. An analysis of the PE production chain shows that PE firms’ strategies integrate various actors and rely on the exchange of knowledge with service suppliers and in wider networks in order to reduce investment risk. The project will analyze these PE knowledge networks and their geographical scope. The geographical dimension of this research is of particular interest. PE firms exhibit a decentralized location pattern with concentrations in regional financial centers. These have traditionally been the locus of financial expertise in the regions, but lost in significance due to concentration and centralization processes. Our empirical research will analyze how PE (re)stimulates place-based dynamics in these centers and the ways in which PE knowledge management connects and integrates regional and supraregional networks. By comparing five regional financial centers as well as PE knowledge networks in Germany, France and the United Kingdom, we adopt a regionally and internationally comparative perspective, thus taking into account both regional context and the importance of national institutions in finance. Our research will (1) support a better understanding of the role of regional financial centers for SME finance in different national and regional contexts and thus provide inputs for regional policy, and (2) contribute to the literature on knowledge management in overlapping networks of varying geographical scopes.

• DFG Programme: Research Grants