A lot of Covid paper and the impact on and the role of the banking sector have been written over the past three years. Andrea Bellucci and co-authors
add an interesting angle, focusing on reallocation effects of the pandemic on venture capital (VC) investments. Specifically, they construct a sample of VC deals that took place in 126 countries around the world from January 2018 till the end of July 2020.
They find that with the onset of the pandemic, VCs invest up to 44% more capital in pandemic-related fields (including biology, chemistry and pharmaceuticals, health, healthcare supply chain, and medical science), while the number of deals increases by up
to 5.8%. One could argue that these findings speak to the efficiency of the venture capital market, given that this market exists primarily of informed investors with longer time-horizons.