Decrease The Administrative Costs: The Route Of Building The Cheap Government

One of the purposes to set up the government is to reduce social transaction costs. Cheap Government focuses on input-output efficiency. It covers the integrity and honesty, and requires efficient and institutionalized operation, too. It is not only a limited government but also an effective government. The Cheap Government is a government to minimize the cost of inputs and to maximize public goods or services, or it is a government to provide the same public goods and services with the smallest input costs. As an excellent government model, Cheap Government pays special attention to the issue of limiting and restraining government costs since it takes the government cost as the premise and government outputs as the target. It is in the 16th National Congress of CPC that the request to reduce administrative costs is put forward for the first time. This indicates that the Chinese Government started to attach importance to the construction of a Cheap Government and the issue of government's input-output efficiency. Then it was called for to establish a standardized public expenditure system in the 17th National Congress of CPC, so as to lower administrative costs, to control administrative expenses strictly, to prevent excessive growth in the cost of administrative and to speed up the building of an economical government.Proceeding from the basic theories of Cheap Government, we explained the significance to construct the Cheap Government. By applying the analysis method of cost - profit in economics, we interpret the relationship between the Cheap Government and the administrative costs. Then by integrating the views of some scholars, we expound the government administrative costs as the scale costs of government, the decision-making costs of government, the social costs of government, the rent-seeking costs of government, and the system cost of government. Then through the empirical analysis of the current high administrative costs situation, we sorted out the problems such as notion plight, motility plight, management plight, and route plight etc. existing in the process of lowering administrative costs and building low-cost government. On this basis, we give some basic ideas for the construction of a Cheap Government: by establishing a scientific concept of political achievements, enhancing the quality of the civil service and strengthening legislation to resolve the notion plight; by the implementation of market-oriented public service, the performance evaluation, and the improvement of supervision mechanism to resolve the motility plight; by advancing government management mechanism innovation and building the framework of public finance to resolve the management plight; and through scientific decision-making and scientific selection system changes to resolve the route plight.