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Venture Capital Investment And Technological Innovation Of High-tech Enterprises

Posted on:2006-05-07Degree:DoctorType:Dissertation
Country:ChinaCandidate:W HeFull Text:PDF
GTID:1119360182965704Subject:Political economy
Abstract/Summary:PDF Full Text Request
Venture Capital Investment(VCI)is a kind of equity investment in the potentially young firms or small and medium enterprises, especially in the high—technology enterprises (HTE) . Empirically, VCI has played a very important role in promoting HTE's technological innovation and driving high-technology industrialization. Though the existing studies in the two fields of technological innovation and VCI are quite abundant, few of them prefer a relatively systematical analysis of the correlation between the above two sides. Based on the existing theories, this dissertation tries to make a research on it. Concretely speaking, centering on a specific type ofhigh-technology firms——HTE, this dissertation tries to theoretically and empiricallyanalyze VCI mechanism, which cultivates HTE's technological innovation capacity and innovation impetus, and HTE's technological innovation mode from the micro perspective of the enterprise's finance and governance and macro institutional analysis, thus constructing a theoretical framework of the correlation between VCI and HTE's technological innovation. Based on the above framework, it analyzes the present state of the VCI mechanism in our country and puts forth some measures to perfect it.As the premise of study, Chapter one firstly discusses the intension of technological innovation and the definition of HTE. Meanwhile, it abstracts the two essentials of technological innovation capacity and innovation impetus. Then, based on the features of HTE, it analyzes the HTE's technological innovation characters that it has strong innovation impetus and weak innovation capacity, which is one of the important factors causing HTE's bankruptcy. Therefore, the thought of this dissertation can be defined as providing a theoretical framework by constructing the VCI-backed technological innovation mode of HTE, which centers on VCI mechanism and the institutional environment's influence on the mechanism.It is very obvious for HTE's technological innovation confronted with the fund scarcity and financing morass, which reflects the weakness in its technological innovation capacity. Chapter two surveys the VCI mechanism in cultivating HTE'stechnological innovation capacity from the perspective of HTE's finance. As the logic basis of study, considering the features of fund demand in the HTE's technological innovation, it discusses the high risk undertaken by outside investors, including the objectively high risk in the HTE's technological innovation and adverse selection and moral hazard arising from the serious information asymmetry. The high risk can also be enlarged because of the entrepreneur's exclusive human capital. Therefore, it can be deduced that the complete VCI mechanism in cultivating HTE's technological innovation capacity should own two aspect: one is the mechanism that VCI deals with information asymmetry and spurs innovation so as to control risk, the other is the VCI's functions in cultivating HTE's innovation capacity, which is important for VCI to gain high return corresponding with high risk undertaken by it. Only on the above basis, do VCI dare to invest in the early stage when the HTE's fund demand is very urgent, and thus resulting in VCI's cultivating innovation capacity of HTE.Based on the above analysis, this dissertation analyzes the feasibility of bank loan as one of possible financing channel for HTE. Through the analysis of bank's information production capacity, relational lend and relational financing, it points out that bank loan, by and large, is limited to cultivating HTE's innovation capacity because of asset safety. And by comparison, as the another possible financing channel, VCI has an advantage over bank loan in two aspects: On the one hand, VCI has the three mechanisms handling information asymmetry and spurring innovation, such as efficient information production mechanism, marketable relational financing mechanism and social risk diffusion mechanism. On the other hand, VCI has a series of functions in cultivating HTE's innovation capacity from the aspects of value-added service, capital support, social net resource support and the support for continuous innovation.Because VCI contract has a very important role in spurring innovation, Chapter three, from the perspective of the enterprise's governance, further explores the VCI mechanism in cultivating HTE's technological innovation impetus through its original governance handling principal-agent problem. Firstly, this dissertation points out that VCI contract is an equilibrium of the game between the venture capitalist (as principal) and the entrepreneur (as agent), and as game rule, the contract decides theactions of both sides through influence on respective interest. Based on the above points, from two aspects of solution to adverse selection and moral hazard, it uses game theory to explore the arrangement of VCI contract and governance mechanism concerned. It's clear that VCI contract is actually a kind of contingent governance mechanism different from traditional contract arrangement, which can realize risk diffusion and incentive compatibility between two sides, thus mitigating agent problem and hence spurring innovation.Considering that a suitably institutional environment is helpful to VCI and HTE's start-up, interaction and development, institutional environment becomes a constraint to the above VCI mechanism. Firstly, according to the influential degree of various institutions on VCI mechanism, Chapter four analyzes relating institutional environments from three hierarchies: fundamentality institutions (including market institution, property rights institution and more level capital market) , momentous institutions (with reference to government's support) and other institutions (with reference to culture and credit environments) .Then, based on the existing technological innovation mode, including technology-pushing mode, demand-pulling mode and chain-linked model, through the introduction of institutional environment, this dissertation puts forward a VCI-backed technological innovation mode of HTE— —knowledge-demand mode, and discusses the feature of this mode from the horizontal and vertical comparison. Up till now, this dissertation has given a theoretical framework about the correlation between VCI and HTE's technological innovation. Under this framework, this dissertation finally compares VCI mechanism from theirs institutional environment and VCI operation mechanism in the United States and Japan, and draws some inspiration concerning fully utilizing VCI mechanism: There should exist a suitable institutional environment; As the institutional supplier, government is important in pushing the development of HTE and VCI, but with regard to government, the key is how to give play to its function; The operation of VCI should abide by its objective law.Chapter five turns to discuss enforcing the VCI mechanism in China. Though our HTE and VCI have made great progress since our country's reform and openness to the world, some factors have still restricted the efficiency of VCI mechanism. Alongthe above framework, these factors manifests in the following: imperfect institutional environment, weak entrepreneurship capacity, venture capitalists' scarcity, bad credit consciousness and unmarketable VCI operation mechanism. At last, this dissertation puts forward practical measures, including perfecting institutional environment, enforcing entrepreneurship education and personnel training, cultivating social credit environment and constructing marketable VCI operation mechanism.
Keywords/Search Tags:Venture Capital Investment, High—technology Enterprise, Technological Innovation, Mechanism
PDF Full Text Request
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