Principal - Agent Theory And Application

Principal-agency has become the principal problem in the research of incentive- constrain mechanism in enterprise. In state enterprise, for it has more complicate and more badly principal-agency problem that state enterprise could not provide effective incentive-constrain mechanism. The principal- agency theory could provide an appropr- -iate analytical point for the reform of state enterprise.How to establish an effective incentive-constrain mechanism for an agent of the enterprise? In this article, based on ready reference and research, we provide incentive-constrain game model of agent with game theory on condition that the information is incompletion between principal and agent. In this way, the incentive- constrain mechanism for manager of state enterprise is established.In the model Principal and agent are both assumed to be risk avoidable.And we have brought implicit incentive such as reputation mechanism and pay postposition into the model.The article includes five parts. The chapter one is introduction. This part introduces the aim, theoretic and practical significance, method, thought course and innovations of the article. The chapter two is Principal-Agency theory summary. This part provides the basic model of principal-agency and summarize extend model of principal-agency through introducing the development of agent problem, principal-agency relationship and theory hypothesis and so on. In the chapter three, in which establishes an incentive-constrain mechanism game model. The chapter four, in which analyzes the manager action of state enterprise, rebuilds the incentive-constrain mechanism of manager of state enterprise. The chapter five is conclusion of the article.