Research On The Incentive And Restraint Mechanism Of Venture Capital In China

The 13 th five-year-plan emphasized that technological innovation should plays a leading role in the overall innovation, through efforts to enhance the capability of independent innovation to provide lasting impetus for economic and social development. Under the background of promoting innovation and entrepreneurship it is also an inevitable choice to speed up the transformation of scientific and technological achievements, and to realize the strategy of innovation driven development. Research on how to build an effective incentive and restraint mechanisms to resolve the principal-agent problem between the participating subjects has important theoretical value and practical significance on improving the efficiency of China’s venture capital, and playing the role of venture capital for scientific and technological innovation.In order to achieve the research purpose, this paper is based on the information asymmetry theory, principal-agent theory and incentive theory, and made the adverse selection and moral hazard problems as the main line. On the basis of the integrated use of literature research, comparative analysis, quantitative methods and case analysis, it has an in-depth research on the incentive and restraint mechanism of venture capital in China. Standing on the perspective of investors and venture capital firms to puts forward the corresponding incentive and restraint mechanisms, and trying to make recommendations to better effect of incentive and restraint mechanisms.The core content includes five parts, which correspond to the third to seventh chapters of the paper. The first part is an overview of the development of venture capital and the analysis of principal-agent problem. Though briefly introduces the history and development status of venture capital in China, and specific analysis the double principal-agent relationship, to provide the basis for the following research. The second part is the practice and problems of venture investment incentives and constraints, which describes the commonly used incentive and restriction measures of the investor and the venture capital institution, and analyzes the problems in the actual process. The third part is the case analysis, which lessons and inspiration from CDH and Alibaba’s success. The fourth part proposes the incentive mechanism of venture capital arrangements by constructing specific incentive and restraint mechanisms. The fifth part is the countermeasures and suggestions to improve the incentive and restraint mechanism of venture capital. In order to create a good external environment for the incentive and restraint mechanisms play a role, the government should proceed from the five aspects of laws and regulations, policy support, financing channels, personnel training and intermediary service system.In the course of the study, this paper trying to be innovative in the following two aspects. First, when the incentive and restraint mechanisms for China’s venture capital improvement suggestions, not only standing on the perspective of investors and venture capital firms put forward ideas and opinions, but also trying to create a favorable external environment for the real role of the incentive and restraint mechanism of venture capital. The second is in carries on the case analysis, selected CDH investments and Ali Baba as the research object, through the analysis of their practices in terms of strengthening the incentive and restraint, for China’s venture capital incentive constraint mechanism perfect reference.