Alfaro L, Kalemli-Özcan Ş, Volosovych V (2008) Why doesn’t capital flow from rich to poor countries? An empirical investigation. Rev. Econom. Statist. 90(2):347–368.Crossref, Google Scholar
Aschauer DA (1989) Is public expenditure productive? J. Monetary Econom. 23(2):177–200.Crossref, Google Scholar
Barber BM, Morse A, Yasuda A (2021) Impact investing. J. Financial Econom. 139(1):162–185.Google Scholar
Bernstein S, Lerner J, Schoar A (2013) The investment strategies of sovereign wealth funds. J. Econom. Perspect. 27(2):219–238.Crossref, Google Scholar
Brest P, Gilson RJ, Wolfson MA (2018) Essay: How investors can (and can’t) create social value. J. Corporation Law 44:206–228.Google Scholar
Brown GW, Gredil OR, Kaplan SN (2019) Do private equity funds manipulate reported returns? J. Financial Econom. 132(2):267–297.Google Scholar
Campbell JY, Hamao Y (1992) Predictable stock returns in the United States and Japan: A study of long‐term capital market integration. J. Finance 47(1):43–69.Google Scholar
Carhart MM, Carpenter JN, Lynch AW, Musto DK (2002) Mutual fund survivorship. Rev. Financial Stud. 15(5):1439–1463.Crossref, Google Scholar
Caselli F, Feyrer J (2007) The marginal product of capital. Quart. J. Econom. 122(2):535–568.Crossref, Google Scholar
CDC Group (2019) Annual Accounts 2019: Towards a decade of action. Technical report, London.Google Scholar
Chari A, Rhee JS (2020) The return to capital in capital-scarce countries. NBER Working Paper No. 27675, National Bureau of Economic Research, Cambridge, MA.Google Scholar
China Development Bank (2017) 2017 Annual Report. Technical report, Beijing.Google Scholar
Chinn MD, Ito H (2006) What matters for financial development? Capital controls, institutions, and interactions. J. Development Econom. 81(1):163–192.Crossref, Google Scholar
Chinn MD, Ito H (2008) A new measure of financial openness. J. Comparative Policy Anal. 10(3):309–322.Google Scholar
Cochrane JH (2005) The risk and return of venture capital. J. Financial Econom. 75(1):3–52.Crossref, Google Scholar
Cole S, Jeng L, Rigol N, Roth BN (2022) What do impact investors do differently? Preprint, submitted September 30, http://dx.doi.org/10.2139/ssrn.4233480.Google Scholar
Coppola A, Maggiori M, Neiman B, Schreger J (2021) Redrawing the map of global capital flows: The role of cross-border financing and tax havens. Quart. J. Econom. 136(3):1499–1556.Crossref, Google Scholar
Dreher A, Lang VF, Richer K (2019) The political economy of International Finance Corporation lending. J. Development Econom. 140:242–254.Crossref, Google Scholar
Desai RM, Kharas H, Amin M (2017) Combining good business and good development: Evidence from IFC operations. Global Economy and Development Working Paper No. 103.Google Scholar
European Investment Bank (2020) Financial Report 2019. Technical report, Luxembourg.Google Scholar
Feldstein M, Horioka C (1980) Domestic saving and international capital flows. Econom. J. 90(358):314–329.Google Scholar
Gardner C, Henry PB (2023) The global infrastructure gap: Potential, perils, and a framework for distinction. J. Econom. Literature 61(4):1318–1358.Crossref, Google Scholar
Goldberg PK, Verboven F (2001) The evolution of price dispersion in the European car market. Rev. Econom. Stud. 68(4):811–848.Crossref, Google Scholar
Gompers PA, Lerner J (1997) Risk and reward in private equity investments: The challenge of performance assessment. J. Private Equity 1(2):5–12.Crossref, Google Scholar
Gourinchas P-O, Jeanne O (2013) Capital flows to developing countries: The allocation puzzle. Rev. Econ. Stud. 80(4):1484–1515.Crossref, Google Scholar
Gray J, Ashburn N, Douglas H, Jeffers J, Musto DK, Geczy C (2016) Great expectations: Mission preservation and financial performance in impact investing. Working paper, Wharton Social Impact Initiative, Philadelphia.Google Scholar
Harris RS, Jenkinson T, Kaplan SN (2014) Private equity performance: What do we know? J. Finance 69(5):1851–1882.Crossref, Google Scholar
Harvey CR (1995) Predictable risk returns in emerging markets. Rev. Financial Stud. 8(3):773–816.Crossref, Google Scholar
Hau H, Rey H (2006) Exchange rates, equity prices, and capital flow. Rev. Financial Stud. 19(1):273–317.Crossref, Google Scholar
Hartzmark SM, Sussman AB (2019) Do investors value sustainability? A natural experiment examining ranking and fund flows. J. Finance 74(6):2789–2837.Crossref, Google Scholar
International Finance Corporation (2018) Blended finance—A stepping stone to creating markets. EMCompass, Note 51. Technical report, World Bank Group, Washington, DC.Google Scholar
International Finance Corporation (2019a) Creating impact: The promise of impact investing. Technical report, World Bank Group, Washington, DC.Google Scholar
International Finance Corporation (2019b) IFC’s strategic alignment with the sustainable development goals. Technical report, World Bank Group, Washington, DC. https://perma.cc/D3QG-NSR8.Google Scholar
International Finance Corporation (2019c) Annual report 2019—Investing for impact. Technical report, World Bank Group, Washington, DC.Google Scholar
Jeffers J, Lyu T, Posenau K (2024) The risk and return of impact investing funds. J. Financial Econom. 161:103928.Google Scholar
Jenkinson T, Sousa M, Stucke R (2013) How fair are the valuations of private equity funds? Preprint, submitted March 7, http://dx.doi.org/10.2139/ssrn.2229547.Google Scholar
Johan S, Zhang M (2016) Private equity exits in emerging markets. Emerging Markets Rev. 29:133–153.Crossref, Google Scholar
Kaplan S, Schoar A (2005) Private equity performance: Returns, persistence and capital flows. J. Finance 60(4):1791–1823.Crossref, Google Scholar
Kaplan S, Sensoy B (2015) Private equity performance: A survey. Annu. Rev. Financial Econom. 7:597–614.Crossref, Google Scholar
Kapur D, Lewis JP, Webb R (1997) The World Bank—Its First Half Century (Brookings Institution Press, Washington, DC).Google Scholar
Kenny C, Kalow J, Ramachandran V (2018) Inside the portfolio of the International Finance Corporation: Does IFC do enough in low-income countries? Center for Global Development Policy Paper No. 115.Google Scholar
Kerr WR, Lerner J, Schoar A (2014) The consequences of entrepreneurial finance: Evidence from angel financings. Rev. Financial Stud. 27(1):20–55.Crossref, Google Scholar
Korteweg A, Nagel S (2016) Risk‐adjusting the returns to venture capital. J. Finance 71(3):1437–1470.Crossref, Google Scholar
Korteweg A, Nagel S (2025) Risk-adjusted returns of private equity funds: A new approach. Rev. Financial Stud. Forthcoming.Google Scholar
Kremer M, Willis J, You Y (2021) Converging to convergence. NBER Macroeconomics Annual, vol. 36 (University of Chicago Press, Chicago).Google Scholar
La Porta R, Lopez-de-Silanes F, Shleifer A, Robert V (1999) The quality of government. J. Law Econom. Organ. 15(1):222–279.Crossref, Google Scholar
Leeds RS, Satyamurthy N (2015) Private Equity Investing in Emerging Markets: Opportunities for Value Creation (Springer, New York).Crossref, Google Scholar
Lerner J, Schoar A (2005) Does legal enforcement affect financial transactions? The contractual channel in private equity. Quart. J. Econom. 120(1):223–246.Google Scholar
Lerner J, Sorensen M, Stromberg P (2009) What drives private equity activity and success globally. Working paper, Stockholm School of Economics, Stockholm.Google Scholar
Lerner J, Ledbetter J, Speen A, Leamon A, Allen C (2015) Private equity in emerging markets: Yesterday, today, and tomorrow. J. Private Equity 19(3):8–20.Crossref, Google Scholar
Levine R (2005) Finance and growth: Theory and evidence. Aghion P, Durlauf S, eds. Handbook of Economic Growth (North Holland, Amsterdam), 865–934.Google Scholar
Lucas RE (1990) Why doesn’t capital flow from rich to poor countries. Amer. Econom. Rev. 80(2):92–96.Google Scholar
Mauro P (2003) Stock returns and output growth in emerging and advanced economies. J. Development Econom. 71(1):129–153.Crossref, Google Scholar
Patel D, Sandefur J, Subramanian A (2021) The new era of unconditional convergence. J. Development Econom. 152:102687.Crossref, Google Scholar
Rapach D, Zhou G (2013) Forecasting stock returns. Elliot G, Timmermann A, eds. Handbook of Economic Forecasting, vol. 2 (Elsevier, New York, Amsterdam), 328–383.Google Scholar
Renneboog L, Ter Horst J, Zhang C (2008) Socially responsible investments: Institutional aspects, performance, and investor behavior. J. Banking Finance 32(9):1723–1742.Crossref, Google Scholar
Roller L-H, Waverman L (2001) Telecommunications infrastructure and economic development: A simultaneous approach. Amer. Econom. Rev. 91(4):909–923.Crossref, Google Scholar
Sorensen M, Jagannathan R (2015) The public market equivalent and private equity performance. Financial Analysts J. 71(4):43–50.Crossref, Google Scholar
Taussig M, Delios A (2015) Unbundling the effects of institutions on firm resources: The contingent value of being local in emerging economy private equity. Strategic Management J. 36(12):1845–1865.Crossref, Google Scholar
World Bank (2019a) World Development Indicators. Accessed July 19, 2024, https://data.worldbank.org/.Google Scholar
World Bank (2019b) Global Financial Development Database (GFDD). Accessed July 19, 2024, https://data.worldbank.org/.Google Scholar

Volume 72, Issue 3

March 2026

Pages 1727-2679, iv-vi

Article Information

Supplemental Material

Metrics

Information

Received:October 10, 2023
Accepted:March 20, 2025
Published Online:July 17, 2025

Cite as

Shawn Cole, Martin Melecky, Florian Mölders, Tristan Reed (2025) Long-Run Returns to Private Equity in Emerging Markets. Management Science 72(3):2041-2063.

https://doi.org/10.1287/mnsc.2023.03313

Keywords

Acknowledgments

The authors thank Mohan Manem especially for providing an understanding of the data. Seminar participants in the Harvard Business School Finance Unit, International Finance Corporation, World Bank Development Research Group, and IMF African Department provided helpful comments and questions, along with Paddy Carter, Adam Fegan, Penny Goldberg, Neil Gregory, Oghale Ighoavodha, Victoria Ivashina, Jessica Jeffers, Kostas Kollias, Josh Lerner, Ita Mary Mannathoko, Fanele Mashwama, Paolo Mauro, Camilo Mondragón-Vélez, Jacob L. Otto, Tommaso Porzio, Raghuram Rajan, Thomas Rehermann, Roberto Rigobon, Antoinette Schoar, and Jesse Schreger. Anshul Maudar provided excellent research assistance. Shawn Cole gratefully acknowledges support from the Division of Research and Faculty Development at Harvard Business School.

The findings, interpretations, and conclusions expressed in this article are entirely those of the author(s). They do not necessarily reflect the views of The World Bank Group, its Board of Executive Directors, or the governments they represent. All results have been reviewed to ensure that no confidential information is disclosed.

This work is provided under a Creative Commons 4.0 Attribution International License, with the following mandatory and binding addition: Any and all disputes arising under this License that cannot be settled amicably shall be submitted to mediation in accordance with the WIPO Mediation Rules in effect at the time the work was published. If the request for mediation is not resolved within forty-five (45) days of the request, either You or the Licensor may, pursuant to a notice of arbitration communicated by reasonable means to the other party, refer the dispute to final and binding arbitration to be conducted in accordance with UNCITRAL Arbitration Rules as then in force. The arbitral tribunal shall consist of a sole arbitrator, and the language of the proceedings shall be English, unless otherwise agreed. The place of arbitration shall be where the Licensor has its headquarters. The arbitral proceedings shall be conducted remotely (e.g., via telephone conference or written submission) whenever practicable or held at the World Bank headquarters in Washington DC.

PDF download

Available Issues

Available Issues

Available Issues

Available Issues

Available Issues

Available Issues

Available Issues

Available Issues

Available Issues

Long-Run Returns to Private Equity in Emerging Markets

References

Volume 72, Issue 3

Article Information

Supplemental Material

Metrics

Information

Cite as

Keywords

Sign Up for INFORMS Publications Updates and News