Theoretical And Empirical Study Of The Professional Manager Market In China

The western managerial revolution has not only undergone the transformation of what the firm owner controls and how he controls, but also promoted the forming of professional managers, the adoption of hierarchy and the change in governing structure, thus bringing about the modern firm system. The evolution of western firm system has proved the significance of an efficient manager market to the establishment of the modern firm system. The efficient market defined here includes the following three points: 1. A market with sufficient participators, that is, a market with sufficient firms and professional managers; 2. A market with effective competing policies of formal and informal restrictions to ensure all participators can behave as required; 3. A market with proper information and market balances. An efficient operation of the manager market means the proper behavior of participators under certain systematical frame through institutional design to obtain corresponding profits.However, in present China the loss of professional morality and the lack of relative formal and informal institutions have resulted in severe moral hazard cost and adverse selection cost, short supply, and imperfect competing policies in the manager market. Therefore, our present manager market, based on imperfect laws, capital market and production market, and also nonstandard governance mode in a firm, is not efficient at all. This hinders severely the establishment of Chinese modern firm system and the furtherance of economic system reform.With the imperfect market system in China, the mode of manager market development is bound to be different from that in the western system of developed market economy. This dissertation, through an analysis of firms and professional managers in the market and their participation, argues the game equilibrium of participators and the relationship of each parameter in the game structure in the given institutional supply, and illustrates the fact that internal and external manager markets will interplay cooperatively because of the interaction of each parameter in the game structure. The cooperativity can be shown in the institutional supply of external manager market, which enhances the market efficiency as well as affects the...