Emerging Markets

Abstract

Investment strategies in private equity are becoming more and more global, increasingly involving emerging markets. These strategies are designed to expand the boundaries of the universe of attractive targets, thus mitigating the risk of possible supply-demand imbalances that could have adverse consequences for returns. However, as this article discusses, emerging markets are becoming more integrated not only in terms of absorbing foreign private equity capital, but also with respect to their growing role as global suppliers of private equity funding. The article finds it significantly more likely that emerging markets will be large net capital exporters of private equity, fueling rather than containing what has become known as the money-chasing-deals phenomenon.