Public policy and venture capital financed innovation: a contract design approach
- The effects of public policy programs which aim at internalizing spill-overs due to successful innovation are analyzed in a sequential double-sided moral hazard doublesided adverse selection framework. The central focus lies in analyzing their impact on contract design. We show that in our framework only ex post grants are a robust instrument for implementing the first-best situation, whereas the success of guarantee programs, ex ante grants and some types of investment grants depends strongly on the characteristics of the project: in certain cases they not only give no further incentives but even destroy contract mechanisms and so worsen the outcome. JEL Classification: D82, G24, G32, H25, H81
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Version Dezember 2006
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| Author: | Julia Hirsch |
|---|---|
| URN: | urn:nbn:de:hebis:30-38039 |
| Parent Title (German): | Center for Financial Studies (Frankfurt am Main): CFS working paper series ; No. 2006,29 |
| Series (Serial Number): | CFS working paper series (2006, 29) |
| Document Type: | Working Paper |
| Language: | English |
| Year of Completion: | 2006 |
| Year of first Publication: | 2006 |
| Publishing Institution: | Universitätsbibliothek Johann Christian Senckenberg |
| Release Date: | 2007/02/23 |
| Tag: | Asymmetric Information; Contract Design; Moral Hazard; Public Policy; Venture Capital |
| GND Keyword: | Öffentliche Ordnung; Risikokapital; Moral Hazard; Asymmetrische Information |
| Issue: | This Version Dezember 2006 |
| Page Number: | 67 |
| Note: | Version Dezember 2006 |
| HeBIS-PPN: | 190882859 |
| Institutes: | Wissenschaftliche Zentren und koordinierte Programme / Center for Financial Studies (CFS) |
| Dewey Decimal Classification: | 3 Sozialwissenschaften / 33 Wirtschaft / 330 Wirtschaft |
| Licence (German): |  Deutsches Urheberrecht |
