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.