Research On The Contract Model For Venture Capital Based On Overconfidence

With the continuous and rapid development of science and technology and economy,the problem of venture capital has attracted more and more attention from all walks of life.Based on this,many scholars have done a lot of research and analysis on the influencing factors of contract design and the contract itself,and thus have achieved some valuable results.However,most of these researches and analyses are based on the assumption of rational economic agents or the psychological factors of agents.However,the theory of overconfidence points out that people in real life generally have the psychological characteristics of overconfidence,this feature has a high impact on the decision-making behavior of the perpetrator.There is no are no exception for those venture capitalists and venture entrepreneurs who are venture capital participants,but they also have overconfident behavior.Therefore,it is an urgent problem to be solved how to design the contract under the bilateral overconfidence and other influencing factors of venture capitalists and venture entrepreneurs.This paper primarily discusses the contract design which is based on the combination of overconfidence and multi-stage investment mechanism and bilateral overconfidence.Firstly,this paper describes the research background,purpose and significance of this topic,This paper introduces what is venture capital and explains the reasons and the expression forms dual principal-agent relationship in the course of venture capital.Then it discusses the relevant research status of domestic and foreign scholars on venture capital,expounds the principal-agent theory,information asymmetry theory and other relevant basic theories.At the same time,it also briefly comments on the direction of this article and lists the chapter structure of this paper.Based on the overconfidence of venture entrepreneurs,this paper establishes a multi-stage principal-agent model between venture capitalists and venture entrepreneurs.Through solving the model,it analyzes the effect of overconfidence level of venture entrepreneurs on venture entrepreneurs' efforts,venture capitalists' efforts and the expected share ratio of investment participants' rights and interests.Based on the situation of bilateral overconfidence,this paper introduces dismissal compensation into the traditional principal-agent risk contract.At the same time,it combines with other influencing factors to build a contract model to explore the influence of dismissal compensation and overconfidence on incentive coefficient,fixed payment,effort level and venture entrepreneur cost.At last,it concludes the research on venture capital contract model based on overconfidence in this paper,it also prospects the future research on venture capital contract based on overconfidence.