【Macro Seminar】Financing (from) the Rich: Venture Capital Supply, Idiosyncratic Risk, and Top Wealth Inequality – A General Equilibrium Analysis of Venture Capital Supply Policy
2026/07/07
研討會日期 : 2026-07-07
時間 : 14:30
主講人 : Mr. Yu Fai (Geoffrey) Kam
地點 : Conference Room B110
主持人 : Professor Leo Lam
演講者簡介 : Mr. Yu Fai (Geoffrey) Kam is currently a Ph.D. student at Washington University in St. Louis. His research interest is Macro-Finance.
演講摘要 : I build a general equilibrium search model of venture capital (VC) with risk-averse entrepreneurs to quantify the effectiveness of VC-supply policies. The model is motivated by the empirically high portfolio share that high-net-worth individuals allocate to private equity: successful entrepreneurs become investors and recycle part of their realized wealth back into the VC market. This recycling generates a supply multiplier that amplifies any policy acting on VC supply, and I use it as a summary measure of policy effectiveness. With CARA preferences, I characterize the value of a VC match in certainty-equivalent terms, which cleanly separates the effect of the mean of entrepreneurial returns from the effect of risk. The model distinguishes two policy margins. The intensive margin raises the mean outcome per match and, by construction, is always efficient at that mean; yet risk aversion and the right-skewness of VC returns sharply attenuate its certainty-equivalent value. The extensive margin instead raises the measure of VC firms, increasing the matching probability and shortening the expected duration over which idiosyncratic risk is resolved. I find the extensive margin to be the more effective lever, and I trace this ranking to the interaction between risk aversion, return skewness, and the supply multiplier.
