China has seen worldwide eye-catching achievements in the educational reform. However, due to the special executive subordination system, formed out of historical reasons and changed little in years of time, and lower risk in the operation compared with some enterprises, a series of problems have emerged in the management and administration of public universities in china: low efficiency in educational resources, down-fall in morality and learning quality of students; unsuitable arrangement of courses and subjects. These problems have seriously impeded the educational reformation and caught the attention of people in or out of the educational field.This thesis, starting with the exposition of the Principal-Agency Theory is to find the main cause of the problem through the analysis on the extant relation of the Principal-agency among the public universities and establish efficient systems for inspriation and constraint by constructing the mathematic model of the Principal—Agency so as to make a useful research for the solving of the public college problems.This paper is of five parts: the first part is a brief introduction of the Principal- Agency theory which introduces the origin, content and character of the theory; The Second part focuses on the present situation of the Principal-Agency in the public universities and focuses on the causes of some problems. The third part is a theoretical hypothesis based on the inspiration and contranit mechanism which holds that...
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