The Mechanism Research For Construction-Agent Projects Invested By The Government Under The Asymmetric Information

The projects invested by the government play an important role in the Chinese economic advancement and social development as well as constitute the major sector of our country s property. Thus, the maximization of the beneficial result for the projects invested by the government and the management level of them always concerned by every part the whole society. However, since influenced by the malpractices existed in the current management style of the projects invested by the government, the beneficial result of the projects invested by the government can not be maximized. For the purpose of getting rid of the malpractices which may hinder the maximization of the projects invested by the government and reforming the current management style of the projects invested by the government, the central government made up its mind to exercise the construction-agent system among the projects invested by the government. Although the construction-agent system can overcome the drawbacks existed in the traditional management model for the projects invested by the government, the new problems derived from its interior principal-agent relationship under asymmetric information are needed to be solved by way of thorough mechanism designing. Otherwise, the construction-agent system can neither be smoothly fulfilled nor achieve anticipated expectation and goals. Hence, under the normative framework of economics and on the basis of the knowledge body and practice of project management (including the typical experience of the construction-agent system), the paper focuses on researching the cause of agent cost incurred from the construction-agent system and the approaches for improving not only the total welfare for both parties of principal and agent but also the investment performance for the construction-agent projects through applying the principal-agent theory of the information economics.The most advanced achievements of the paper on the researching domain mentioned above are as follows: First, the paper established both the V-N-M expectation utility functions about the principal and the agent of the projects invested by the government and the relevant principal-agent model. With the view of studying the mechanism of risk management for construction-agent system, the paper thoroughly analyzed the relationship between the risk attitude of both principal and agent in the construction-agent projects and the agent cost, total welfare function and the maximization of beneficial result of the projects invested by the government. Furthermore, through originally expounding the rationality of the entry of risk-share degree into the construction-agent contract as a non-efficient statistic variable, the paper drew a conclusion that assign the risk between the both parties of the principal and the agent reasonably is the approach to decrease the agent cost of the construction-agent projects and increase the beneficial result of the projects invested by the government. On the basis of research about the mechanism of risk management for the construction-agent system, the paper also studied the risk/benefit mechanism for the construction-agent system. The core of it is how to measure the risk ratio undertaken by the both parties of the principal and the agent of the construction-agent projects. The paper presented a new method which can measure the risk ratio accurately and overcome the drawbacks existed in the traditional methods. As to the problem regarding the job-design for the consttuction-agent enterprises who undertake the management tasks throughout the whole construction-agent management process under multi-task conditions, the paper analyzed the relationship between the job-design for the construction-agent enterprises and the output level of construction-agent enterprises by establishing the principal-agent model , and an important conclusion that the sole liability is dominant to joint liability in construction-agent projects can be drawn. Because the output level of construction-agent enterprises has a close relationship with the performance level of the team of the construction-agent enterprises, so the paper also employed a lot of energy in the research about the motivation and restriction mechanism for the team work of the construction-agent enterprises and how to govern the "shirking" problem .Through establishing the principal-agent model based on the individual and team, the paper solved the key problem concerning how to govern the "shirking" phenomena which will be encountered by the construction-agent enterprises during their management works.The research of the paper involved the several important topics of the mechanism design about the smooth fulfilhnent of construction-agent system. The achievements of the research can be in highly theoretical value in directing the implementation of the construction-agent system. Meanwhile, it can also play an important role in providing reference about how to improve on the beneficial result and management level of our country s projects invested by the government.