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Venture Investment Incentive Mechanisms and Simulation with Venture Entrepreneurs Having Multistage Efforts Based on Fairness Preference Theory
Joint Authors
Wang, Kaihong
Chen, Jiacheng
Li, Aimin
Ding, Chuan
Source
Discrete Dynamics in Nature and Society
Issue
Vol. 2016, Issue 2016 (31 Dec. 2016), pp.1-12, 12 p.
Publisher
Hindawi Publishing Corporation
Publication Date
2016-10-10
Country of Publication
Egypt
No. of Pages
12
Main Subjects
Abstract EN
When venture capital has been invested into venture companies, venture capitalists and venture entrepreneurs form a principal-agent relationship.
Take into account the fact that the venture entrepreneur’s effort is a long process, because the effort is not the same at different stage.
Therefore, efforts variables are seen as the multistage dynamic variable, and venture investment principal-agent model with venture entrepreneurs having multistage efforts is constructed on the basis of the classic principal-agent theory in the paper.
Further, in the later stage effort of venture entrepreneurs is affected by the size of prestage benefit with venture capitalists and venture entrepreneurs; thus the fairness preference model is improved, and venture investment principal-agent model with venture entrepreneurs having multistage efforts is constructed on the basis of fairness preference theory.
Both theoretical derivation and simulation have demonstrated that, under the condition of information asymmetry, if the fairness preference of venture entrepreneurs holds, then (1) venture capitalists provide venture entrepreneurs with level higher than that without fairness preference, (2) in every single stage venture entrepreneurs make efforts higher than those without fairness preference, and (3) in two periods both venture investors and venture entrepreneurs gain total real gains higher than those in two periods without fair preference.
American Psychological Association (APA)
Wang, Kaihong& Ding, Chuan& Chen, Jiacheng& Li, Aimin. 2016. Venture Investment Incentive Mechanisms and Simulation with Venture Entrepreneurs Having Multistage Efforts Based on Fairness Preference Theory. Discrete Dynamics in Nature and Society،Vol. 2016, no. 2016, pp.1-12.
https://search.emarefa.net/detail/BIM-1103504
Modern Language Association (MLA)
Wang, Kaihong…[et al.]. Venture Investment Incentive Mechanisms and Simulation with Venture Entrepreneurs Having Multistage Efforts Based on Fairness Preference Theory. Discrete Dynamics in Nature and Society No. 2016 (2016), pp.1-12.
https://search.emarefa.net/detail/BIM-1103504
American Medical Association (AMA)
Wang, Kaihong& Ding, Chuan& Chen, Jiacheng& Li, Aimin. Venture Investment Incentive Mechanisms and Simulation with Venture Entrepreneurs Having Multistage Efforts Based on Fairness Preference Theory. Discrete Dynamics in Nature and Society. 2016. Vol. 2016, no. 2016, pp.1-12.
https://search.emarefa.net/detail/BIM-1103504
Data Type
Journal Articles
Language
English
Notes
Includes bibliographical references
Record ID
BIM-1103504