Presenter: Xundong
Yin
Topic: Venture
Capital, Patents and Innovation
Time: 16:00-17:30,
Apr 16th, 2013
Location: 608
Acedamic Hall
Abstract This
paper provides a new channel through which venture capital promote starts-ups in
the sense that by gaining a private benefit from start-up financing without
patent protection, the venture capital is more willing to finance entrepreneur
at the beginning than other investors. Based on a double moral hazard model, we
find that comparing to the non-VC investors, the willingness to invest is higher
for venture capitalists, it mitigates the credit constraints of entrepreneur and
thus facilitate the startup of entrepreneur and foster their productive
innovation activities.