Research on the incentive compensation of agent based on principal-agent theory

Abstract

Since reform and opening up, the government investment projects in China are developing by leaps and bounds, which almost cover all the key sectors such as economy, culture, science and education as well as defense etc. However, for a long time, the government financial capital investment project follows the traditional management model of the planned economy system. Therefore, it cannot meet the requirements of market economy system. The State Council urges in its Decision on Reform of Investment System to promote "agent system" in the non-profit government investment projects vigorously in 2004, in a bid to improve the government investment efficiency. © 2012 Springer-Verlag London Limited.