Study On Manager Incentive-constraint Mechanism In Non-government Education Industry

It has been 30 years since China issued the opening-up policy. During the past 30 years, China has reached great achievements. The GDP increased 67 times and the import and export trade increased 104 times. The amount of foreign investment has got an average yearly increase of 20% whilst the tourism income got 26.7% each year. Along with the booming economy, it brings up a huge lack of talent resources.Under this backdrop, since it is impossible for the state facilities to meet all the urge needs, many non-government education organizations were established. They developed fast from scratch with problems, such as unstable teaching quality and human resources, unreasonable prices etc. They copied corporate governance methods from other industries without improving, which result in more problems eventually.Comparing between non-government education industry and other industries, this study summarized the differences in governance methods and manager incentive-constraint mechanisms. It says a reasonable manager incentive-constraint mechanism is the key to solve all those problems coming up in this industry. This study believes that an effective manager incentive-constraint mechanism should base on a thorough research on the company's size, portfolio investment, organizational goal and business pattern etc. According to the features of non-government education organizations, small size, single portfolio investment, clear organizational goal and simple pattern, the incentive mechanism should include human capital theory, public reputation and personal identity etc; the constraint mechanism should include business contracts and company rules, consumer's expectations and laws, together with public supervisory system and self-regulations.This study also appeals to the support and understanding of the government sections regulating this industry. The government supervisory sections should keep an open mind and learn oversea developed countries'advanced experience in education industry. By combining theories with practice, by using forms with case studies, this study analyzed manager incentive-constraint mechanism thoroughly. In the end, it gives the industry advices for reference or for an actual try to improve the current condition.