Research On The Sources Of Funding In China's Industrial Associations

With the Theory of Transaction Costs as theoretical underpinnings, this paper studies the basis on which industrial associations came into being and have been financing themselves through the Method of Cost-benefit Analysis; in the analysis of the status quo of domestic industrial associations, the current lack of funding facing these associations is studied; the sources of funding in domestic and foreign industrial associations are compared and the causing factors for the lack of funding in domestic industrial associations are thoroughly analyzed; with the current development of domestic industrial associations taken into account, suggestions are made on how to better the sources of funding in domestic industrial associations from the perspective of the government and industrial associations respectively; finally, with Wenzhou Clothing Business Association as an example, the financing situation of the well developed industrial associations in China is studied as a corroboration of the ideas conveyed in this paper.The findings of this paper are as follows: the lack of funding is a common problem that domestic industrial associations are faced with; the solution to this problem is twofold: the government should transfer the power to the lower level, establish models of purchasing services, increase preferential taxes, and invest directly; industrial associations should reform themselves and optimize the four primary sources of funding.