| Many scholars at home and abroad have studied the problem of investment in higher education; however, most of them carry on researches on a national base. This paper studies the behavior of government investment in higher education in Inner Mongolia from the local government investment perspective. Education and economic theory, public goods theory, and new institutional economic theory are used as the reach bases, and various research methods have been used in this paper.The future development trend of government investment in higher education is using government investment as the main body, and actively expanding various investments. The Government as a major investor in higher education is both the objective requirement of the development of higher education and the must choice under the market economy condition’s "market failure". However, there are many problems in the Government-funded higher education due to its structural defects and level of economic development, which affects the development of higher education in Inner Mongolia.This paper analyses the factors in Inner Mongolia government investment and the current Government investment status.it points out the problem existed in Government investment higher education, and raises proposals and conclusions accordingly:forming a reposition of the relationships among Government, university, and society, while continuing to make "financial" developing, changing the over-reliance on government investment in colleges and universities, and making full use of the market mechanism to change the present situation of higher education’s separation from social development. Thus, higher education in Inner Mongolia Autonomous Region will have a healthy thriving within Inner Mongolia’s rapid economic development. |