Case Study Of Governments' Failure In Coordination Games And Its Function Transformation In The Economic Development Of Yangze Delta

With the background of globalization, the integration of the Yangze Delta economic area and especially the integration of resources, combination of advantages and mutual benefit of Zhejiang, Jiangsu Provinces and Shanghai Municipality will become the major growth point of the regional development, and meanwhile, will push the structural optimization and industrial upgrading. However, we can always find the cases of governments' failure of coordination games in the regional economic development, for instance, "attract investment in a dumping style", "regional environment pollution", "similarities of he economic structure"," all compete to develop production bases". Then, what are the reasons that cause the regional governments' failure in the coordination games?This article aims at analyzing some cases of economic administration with aspect of expecting profit, cost and objectives of games to find out the reasons of governments' failure of coordination games in regional economic development. From the aspect of profit, it points out that the failure possibilities are in the expectation of governments' expecting profit and the adoption of immoral methods to meet this expectation. From the aspect of cost, it states that the reason of failure is governments' advantage of low cost but with no scientific evaluation system to measure the effective using of this advantage. From the aspect of objectives, it says that regional governments' gaming of sharing resources will easily cause the failure of coordination games, while will also easily cause the success of exclusive resources' coordination. And from the aspect of communication, it holds that the reasons of governments' failure lie in the governments' reputation crisis, outside interference or the profession risk of the decision-maker itself.With the study of governments' failure in coordination games, and from the aspect of the reform of governments' function, this article points out how the governments, facing the regional development, to adjust and complete their functions, and in consequence to strengthen the coordination function and establish complete balance institution with the purpose of better service for the market and the sustainable development of regional economic development.