This paper proposes a simple partial equilibrium model to investigate the effects of government policy on venture capital backed investments. Giving up an alternative career, entrepreneurs focus their effort on a single, high risk venture each. Venture capitalists acquire an equity stake and...

Many researches and practical experiences clearly indicate the existence of a strong relationship between entrepreneurial activities and the business environment in which these activities are initiated. Although this topic has been quite ignored until the late twentieth century, a lot of studies...