What are the finance theories about entrepreneurship?
Agency TheoryLiquidity Constraint Theory
Agency theory starts with negative assumptions about entrepreneurs and seeks to govern them.
Information asymmetry helps to explain the bargaining power of entrepreneurs in their relationships with stakeholders.
Liquidity theory posits that access to capital is the key to entrepreneurship.
Pecking order theory posits how entrepreneurs decide on modes of financing.
Real Options Theory
Real options theory looks at entrepreneurship from a gambler's perspective.
Signaling theory explains how entrepreneurs inadvertently communicate with stakeholders.