Please use this identifier to cite or link to this item: http://hdl.handle.net/1783.1/4363

The role of renegotiation on incentives and welfare in venture capital

Authors Ma, Xiaoyan
Issue Date 2002
Summary The replacement of the founder CEO (Entrepreneur) by a professional manager is becoming more and more popular in venture capital industry. This paper examines this replacement problem in an environment where it can only happen with ex post renegotiation after the revelation of the entrepreneur's ability. By analyzing two situations----- the situation under which renegotiation is allowed and the situation under which it is not allowed, we show that this possibility of renegotiation on the replacement problem can induce more incentives and improve social welfare.
Note Thesis (M.Phil.)--Hong Kong University of Science and Technology, 2002
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Language English
Format Thesis
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