Research On The Management Of Virtual Construction Enterprise Based On Principal-Agent Theory

Virtual construction enterprise is the application of virtual enterprise in construction, which is widely used in the international construction market. And it makes very good result in the world. However, virtual construction enterprise also has some shortcomings, which restrict the healthy and rapid development of the virtual construction enterprise. This thesis aims to sovle the problems mentioned above through optimizing the contract among the cooperators and setting up the mechanism of controlling the cooperations'moral hazard.First of all, this thesis explains forming and development of virtual construction enterprise in detail, analyzes its advantages and disadvantages, and introduces development and application of principal-agent theory. It lays the thesis's foundation through the principal-agent relationship analysis in virtual construction enterprise. Principal-agent theory studies how to design the contract between the principal and agents effectively, to make cost least. In the virtual construction enterprise, the core enterprise can be regarded as the principal; the cooperators can be regarded as agents. Principal-agent theory can effectively settle the problems which cooperators are apt to consider themselves or be too lazy to reduce the core enterprise's benefit. Secondly, the thesis analyzes the moral hazard existing in the virtual construction enterprise, and adopts the moral hazard with hidden action model perfected by Holmstrom. On the basis of this model, the thesis designs different parameters for unique characteristics of virtual construction enterprise, and calculates the concrete parameter model to obtain the optimal key. Finally, the thesis designs a mechanism to control the moral hazard in the virtual construction enterprise, which is founded by building the negative encourage mechanism when breaking the contracts and deciding the team's punishment distribution coefficient.