Positioning In The Role Of Venture Capital

Government takes a very important role in developing Venture Capital throughout the world. Because of the special characteristics of China transitional economy, government hasn't been in the appropriate position since the advent of VC in China, which restricts the development of China VC. At present, the broken-bubble of Net-economy urgently prompts government to take its right way in VC area.Government can involve into three environmental fields to help expanding VC, that is, policy environment, finance environment and region & culture Environment. To put the theories of Government Economics and Institutional Economics into practice, we can find that the most important function of government is to make institutional innovation, and the validity of government should be weighed by the validity of market.Nowadays, there are three typical VC development models in the world, i.e. the US's, the Japan's and the Western Europe's. In different model VC has different traits, and the government functions differently too. But, no matter how different they are, each model has been formed in accordance with the economic condition of each country. Therefore, China needs to explore a practical way with "Chinese characteristics" to develop VC.Based on both theoretical and practical analysis, this paper brings forward some suggestions on how to promote China VC. Government really needs to make many efforts in adjusting its role.