A Study On Some Issues Concerned With The Improvement Of Venture Capital Decision Making

From 1980s, the world economy has stepped into a new period-economic globalization. At the same time, international business competition has become even more intensive. On Dec. 11th 2001, China formally entered the World Trade Organization, which facilitated China getting involved to a much greater extent in international trade. Each country, in order to be realize the gains from competition, must actively adjust its industry structure and economic policies. It is known that high-tech industries are the guiding force of economic development, and a perfect economic system would doubtlessly encourage the growth of this sector. The history of international venture capital is no more than 50 years old, and in China, its history is much shorter, especially regarding decision-making theory. Therefore, research not only has practical significance, but also feeds the needs of economic development.Studies focusing on the theories of venture capital are a relatively new problem. This dissertation was carried out using a combination of methods including both quantitative and qualitative analysis, a combination of economics and system engineering, and a combination of normative analysis and case study, all regarded systematically and dynamically. The research focuses on two objectives: first, summing up the operation system of venture capital; and second, bettering and innovating the theoretical study through a concentration on decision-making. The material is presented in the following form:Operating System of Venture Capital. Summing up the operation system of venture capital in a systematical way presents a betterment and innovation on several approaches including the Principal-Agent Relations Structure Model, Venture Capital Operation Circulation Model and Venture Capital Risk-Earnings Model.Multiple Objectives Evaluation Index System and Analytical Hierarchy Process (AHP). Three decision-making theories on venture capital (Net Present Value Theory, Expected Utility Theory, and Option Theory) are compared with each other. For the system engineering component, a Multiple Objectives Evaluation Index System was set up, followed by an application of AHP to data processing.International Comparison and Corresponding Policy on Venture Capital. In comparing and analyzing different development experience in the U.S.A, Japan, Korea, Singapore, Taiwan, etc., this research indicates several corresponding suggestions with respect to the obstacles on policy, statutes and markets in China.