Government Investment Management And Research Under Market Economy Conditions

Investment, as a spur in the "troika" of macroeconomics, has a special significance in China. Ever since the reform and opening up policy in late 1970s, fixed-asset investment has risen from 29.8% in 1978 to 47% in 2007--a rate that is 15%--20% higher than that in developed countries, and 20%--30% higher than that in developing countries. After the breakout of world financial crisis in 2008, investment in 2009 rose sharply to account for 67% of GDP, and is estimated to account for 70% in 2010. In this sense, China can be named as an investment-driven economy.Government investment is a major part both in social investment and fiscal expenditure. It has always been under widespread attention from people in all walks of life, not only because its scale, structure and efficiency are closely associated with economic growth, but also because it is involved with huge amounts of money, large numbers of people and complex ways of management, especially in recent years, with the increase of government investment year by year, frequent occurrence of "Three Excesses" phenomenon (The status of budget estimation outrunning estimation,budget outrunning budget estimation and final accounts outrunning budget), and universalization of building "roads too wide" and "squares too big". Thus the public has a higher expectation of the government in choosing projects, managing funds and promoting efficiency. Based on reality, the author explored the problem by using experience gained from his work and borrowing experience from other countries.The treatise is composed of 3 parts with 6 chapters:introduction, the main body and conclusion.The introduction part includes the following aspects:the academic background, theories and significance of the research topic; literature review of works both at home and abroad; its source and research contents, its creative result or theories (with new ideas); envision of conducting further research in this area. Chapter 2 starts from the necessity of government investment under the condition of market economy, and tries to provide theoretical evidence to establish a sound management system for government-invested projects that is compatible with socialist market economy by introduction of public finance theory, new public management theory, public choice theory and principal-agent theory, and analysis and exploration of public finance theory and defining the scope of government investment, of new public management theory and government investment performance, of public choice theory and restraint in the responsibility of government investment, of principal-agent theory and supervision of government-invested projects.Chapter 3 begins with a full retrospect of the history of government investment management in China. It lends insight for the reform and perfection of market-oriented management of government-invested projects by combing of the transformation of government investment from planned methods to market ones. Then by illustrating some typical example, it will introduce the main content of government investment, thus presenting a real picture of the status quo of government-invested projects in China.Chapter 4, a continuation of Chapter 3, is the major part of the thesis. To make the policies in the following chapter effective, the author takes a firm stand and states directly the shortcomings of government investment in scoping of investment, decision-making mechanism, construction management, risk prevention, investment and finance, and the effectiveness of supervison. With detailed and deepened analysis of reasons for the above, it points out a way out of the problem.By citing experience of government investment in the US, Britain, Germany, Canada, Japan, Hokong, Chapter 5 introduces the scale and scoping of investment, decision-making mechanism, investment and finance, construction and practice management and supervision in developed countries and regions. By analysis and induction of their experience, they present an excellent reference for improving management of China's government-invested projects under the condition of market economy.Chapter 6 is the conclusion part, answering the questions raised in previous chapters. It is also an epitome of the author's ideas. The author's train of thought for solving the problem includes 5 aspects:first, by drawing the scope under the condition of market economy, the government investment acts within the line; second, the government investment should divide into two parts--for-profit and non-operational government investment. The former shall practice full marketized construction management and investing and financing. It will be administered by government in the name of social investment with measures of strengthening supervision, ensuring demand and regulating order. But the focus of government investment is non-operational investment, despite its difficulty; third, to practice agent system for government-invested projects and establish a construction management aimed at controlling investment; fourth, to set up a scientific, democratic and complete system for decision-making of government-invested projects based on principle of transparency, public participation and accountability; fifth, we need to strengthen the external regulation-oriented supervision system of government-invested projects. In the end, the author raised hopes for coordinated reform measures.The author has been engaging in assessing government-invested projects for a long time, and wishes this article can deepen our understanding of it and offer guidance in practice.