The Incentive Mechanism Research Of Supervision Of Large Projects Based On The Life-Cycle Theory

This paper is mainly use the principal agent theory to research the role of the supervisor’s incentive mechanism in large engineering projects. Specifically, design a kind of incentive mechanism to promote and improve the level of the supervisor’s efforts, in order to solve the free rider problem about large projects. The large engineering project has long cycle, so consider the life cycle theory applies to large engineering projects. The construction of large project will be divided into different life cycle, and design the corresponding incentive mechanism in the different early life cycle, in order to improve the supervisor’s effort level during the life cycle. Due to the construction of large project is a continuous process, and the performance between the life cycle of the supervisor will be influenced by other life cycle more or less. So the introduction of Holmstorm agent model which based on the Fama reputation mechanism, and design a stage of the incentive mechanism for the supervisor of large engineering projects, and contact the supervision the life cycle of the relationship between income and output, in order to promote and improve the efforts level of the supervisor. At the same time, establish a single stage does not consider the reputation mechanism of the incentive model, and compare with the two types of incentive model that based on the analysis. In the last of this paper, use assignment method to test the incentive model.The paper found that, firstly, the reputation incentive mechanism of mechanism is applied to the multi stage is not effect to the supervisor in the life cycle of the last effort level. Secondly, the incentive mechanism on the front of the life cycle has positive effect or negative effect depends on the actual situation. The main reason is the ability of the supervisor in market and the output share coefficient which has been made by the owner at the start of the life cycle. At the same time, the paper also found that, regardless of the incentive mechanism model of single stage or multi-stage incentive mechanism model, fixed wages cannot promote and improve the level of supervisor’s efforts. What’s more, in general, the incentive mechanism of multi stage than single stage can bring the owner more utility revenue.In the construction of large engineering projects, the supervisor is very important for the successful completion of the large projects as the management of construction site. Therefore, to explore the incentive mechanism and promote efforts to improve the level of the supervisor which has the effect of promoting to ensure the completion of the large-scale engineering project in time,Providing advice on management of project supervision for the owner of major projects. Meanwhile, the large-scale projects for the growing importance of the people’s livelihood, to improve the management of the utility in major construction projects, which is a guarantee for people’s livelihood.