Models Of Game Theory In Venture Capital

Game Theory has had a more and more extensive application in economic fields since its foundation in last century. And a large number of integrated theories and models have been arisen. In the latest decade, venture capital has been prevailing as the rapid development of new economies and information technologies. At first, only some individual investors entered into this high risk and profitable investment taking part in the project of individual entrepreneurs. And now, the venture capital projects have been analyzed and operated by occupational investment analysts in the professional investing organizations. However, the present studies focus on the evaluation of investing projects and entrepreneurs from the venture capitalists' aspect ignoring the game behaviors between them.In this dissertation, game theory is used to study and analyze the operation of venture capital from the aspect of game behaviors and strategies of venture capitalists and entrepreneurs. The main works are as follows:Under the condition of in-continuous hard-working level, it establishes that the basic game model between the venture capitalists and entrepreneurs. Based on this model, the third stage of games stress is analyzed. And four game theory models are established according to different decision variables of venture capital and the concrete game structure, non-cooperative or cooperative.A non-cooperative game model is presented with the amount of investment and hard-working level as venture capitalists' and entrepreneurs' strategies variables. The Nash equilibrium of this model is proven existent. And it is argued that there is interaction between the level of entrepreneurs' hardworking and the amount of venture capitals. Moreover, the iterative algorithm is derived accordingly for solving the Nash equilibrium of this model.A non-cooperative game model is presented with the ratio of shares distribution and hard-working level as venture capitalists' and entrepreneurs' strategies variables. The existence of Nash equilibrium is proven in the same way. It is also proven that the ratio of shares distribution affects hard-working level. And the means to find the satisfactory solution are given.A cooperative game model is established with the amount of investment and hard-working level as venture capitalists' and entrepreneurs' strategies variables. The necessary conditions of coalition optimal solution are presented. And it is analyzed the interaction between the coalition optimal solution of cooperative game model and the Nash equilibrium solution of non-cooperative game model and the stability of coalition optimal and the adjunctive conditions for keeping coalition optimal stable. The iterative algorithm is derived to reach the coalition optimal solution.A cooperative game model is established with the ratio of shares distribution and hard-working level as venture capitalists' and entrepreneurs' strategies variables. The necessary conditions of coalition optimal solution are presented. And it is analyzed the interaction between the coalition optimal solution of cooperative game model and the satisfactory solution of non-cooperative game model, the stability of coalition optimal and the adjunctive conditions for keeping coalition optimal stable and the distribution principle of maximal coalition utility.