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**A multi-period game theoretic model of venture capitalists and entrepreneurs.**
*(English)*
Zbl 1049.91023

Summary: This study examines the relationship between a venture capitalist and an entrepreneur and follows it from its inception to the exit stage. The model we use is a multi-period game theoretic model with moral hazard where the contract is set in the first period. The contribution of the study lies in the insights it provides on optimal contracts and its characterization of an endogenous exit point. Specifically, the paper shows that the optimal incentive scheme should backload all incentive payments to the entrepreneur as much as possible. Consequently, a straight debt contract would be optimal in venture financing.

### MSC:

91A20 | Multistage and repeated games |

91A40 | Other game-theoretic models |

91B28 | Finance etc. (MSC2000) |

91B40 | Labor market, contracts (MSC2010) |

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\textit{R. Elitzur} and \textit{A. Gavious}, Eur. J. Oper. Res. 144, No. 2, 440--453 (2003; Zbl 1049.91023)

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### References:

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This reference list is based on information provided by the publisher or from digital mathematics libraries. Its items are heuristically matched to zbMATH identifiers and may contain data conversion errors. It attempts to reflect the references listed in the original paper as accurately as possible without claiming the completeness or perfect precision of the matching.