implications for economic growth. We start with a Schumpeterian endogenous growth model where entrepreneurs earn monopoly profits … by inventing better goods and financiers arise to screen entrepreneurs. A novel feature of the model is that financiers … processes for screening entrepreneurs. Every existing screening process, however, becomes less effective as technology advances …

In the course of ordinary business, commercial banks frequently encounter entrepreneurs seeking loans for the purpose … of financing new or continuing projects. These entrepreneurs are frequently unrealistic, their perception having been … relationship between banks and possible optimistic entrepreneurs. We examine this capital market from the stand-point of economic …

credit markets. Due to the financial imperfections, high-productivity firms - which are run by entrepreneurs - must be …

to the taxation of entrepreneurs in transition economies. …

product markets. We consider risk-averse entrepreneurs who produce with uncertain production costs. To reduce their exposure … to risk they can sell stocks to risk-neutral outside-investors. We show that in equilibrium the entrepreneurs prefer not …. Furthermore, we discuss how the optimal financial structure reacts to variations in entrepreneurs' risk aversion, the level of …