The State-owned Assets Principal - Agent Problem

The key problem of constituting the management and operation system of state-owned assets is to establish a reasonable and clear legal relationship. The Principal-Agent issue gets involved in not only the state-owned enterprises, the state-owned assets, the reform of the management system of state-owned assets, but also the establishment of the Committee of State-owned Assets. Presently, the researches in the Principal-Agent issue are mainly conducted from an Economics' angle, which are in urgent need of Law's participation.First of all, this paper introduced the basic theory of the Principal-Agent issue, and compared the Principal-Agent issue from Economics and Law. It is pointed out the different meanings of the term 'Principal-Agent issue' in Economics and Law, the economic basis and the explanation from Law of Principal-Agent, the cause of the Principal-Agent issueThen, through the comparison between the Principal-Agent issue of state-owned assets and the issue of private assets, the paper put forward that the fundamental difference lies in the property system and the rights, obligations, interests and benefits from the property system.Based on the above, the paper proposed the solution from Law's angle to the Principal-Agent issue. According to the principle of "definite property, clear obligations, the combination of incentives and constraints", the harmony of rights, obligations and interests and benefits among owner, corporation, and the management should be achieved.At the end, the paper discussed the governance of the state-owned assts, from rights, obligations, interests and benefits.