Institutional Barriers and Venture Finance Under Export Controls: Evidence from China’s High-Tech Sectors

Speaker: Yikai Cao, PhD Candidate in Management Science and Engineering, Stanford University

Export control measures have emerged as a critical institutional shock reshaping global political and economic dynamics. While prior studies have focused on how institutions shape entrepreneurial behavior and firm-level responses, our study adopts an institutional theory lens to examine the impact of export controls and industrial policy on venture capital (VC) investment decisions. Integrating firm-level financing data with policy analysis, we find that following export controls, domestic VC funding increases significantly and concentrates in key technological fields. To isolate the causal effects of these regulatory changes, we employ a difference-in-differences approach. Our findings contribute to institutional theory by demonstrating how regulatory shocks reshape investor risk-return assessments and provide valuable insights for policymakers and investors navigating geopolitical tensions.

About the Workshops

Our Young Researcher Workshops offer emerging China scholars an opportunity to engage directly with interdisciplinary faculty and peers from across campus to discuss and receive feedback on their research. Each workshop features one or several PhD students presenting their latest empirical findings on issues related to China’s economy. Past topics have included college major selection as an obstacle to socioeconomic mobility, the effect of a cooling-off period on marriage outcomes, and factors contributing to government corruption. Faculty and senior scholars provide comments and feedback for improvement. This event series helps to build and strengthen Stanford’s community of young researchers working on China.

Workshops are held on select Fridays from 12 - 1 pm. Lunch will be provided! 

Visit the Young Researcher Workshops webpage for more information on the content and format of the series and to learn how to sign up to present.