Comparative Study On Reducing Institutional Transaction Cost

Institutional transaction cost refers to the cost caused by set of governmental rules to the market players when following various regulations including tax cost,financing cost,time cost and opportunity cost.Reducing institutional transaction cost should be realized during the process of streamlining administration and delegating power to the lower levels.Measures like deepening the reform on administrative approval system,investment approval,commercial system and professional qualification,carrying out reform on fees charging,innovating supervision mechanism,online examination and approval system,fair competition among market players will facilitate the reduction of institutional transaction cost.With both comparative analysis and empirical research,the thesis put forward hypothesis of petrol station indicators based on cases of Nanjing,Suzhou and Wuxi.By identifying institutional transaction cost in these cities and comparing with the cost of corresponding petrol stations in New York of the United States,a study on the current reform on administrative approval systemReflected on the previous analyze,policy proposals on further deepening administrative approval system are put forward,such as completing sector legislation,open sector access,further streamlining administration and delegating power to the lower levels,regulating administrative approval issues,strengthening supervision,replace online approval with offline approval so as to substantially reduce institutional transaction cost.