Research On Rent-Seeking Of Government Procurement

Government Procurement, as an important branch of financial expenditure management, it plays an important role in activities of the national economy. My country carried out pilot of government procurement from the mid-90s in some areas, and "Government Procurement Law" was enacted in2003. China has established a system of government procurement after ten yeas of reform and practice. With the expanding scope and scale of government procurement, the economic efficiency, the degree of social concern and influence has improved significantly. The scale of government procurement increased from13billion yuan in1999to1.1332trillion yuan. Government procurement pattern is gradually formed mainly by open tender, flexible and effective use of a variety of ways.China’s government procurement has made great achievements, while also facing a very serious problem. From government procurement angle of rent-seeking behavior, analysis of rent-seeking behavior and harm, so as to better improve the government procurement system. Both developed and developing countries, the rent-seeking problems are widespread in the government procurement process. Some government officials are often tempted to abuse their power for rent-seeking, resulting in a lot of rent-seeking phenomenon in China’s government procurement. There has been30million yuan overall bathroom,22000yuan single seat and16million yuan a VIP seat in procurement of high-speed rail. The whole bathroom up to300,000,22,000yuan a single seat,16-million a VIP seat, government officials use their power to set rent and suppliers in order to pursue their own interests to rent-seeking. In recent years, there are many similar cases of rent-seeking, such as a city finance bureau purchases the Apple itouch4as U disk, a city Public Security Bureau purchases Apple iphone4as police communications. The astronomical government procurement not only reflect the multiple problems in government procurement system, but also resulted in a waste of social resources, disorder of the order of the market competition and a loss to the public interest. Yong wen line high-speed rail catastrophic accidents occurred in2011, for example, government procurement tender of rent-seeking behavior caused the death of40people. Therefore, how to establish an effective preventive mechanism to curb rent-seeking behavior in government procurement is one of the important issues facing China’s government procurement work.This paper firstly introduces the concept of government procurement, the size, scope and manner of government procurement in China, and elaborates the theory of "economic man" hypothesis, principal-agent theory and the theory of rent-seeking, it laid a solid foundation for the thesis. Then this paper refers to the high-speed rail astronomical procurement event to explore the causes of rent-seeking behavior in government procurement, such as principal-agent failure, economic man to seek maximum benefits, the unscientific way of government procurement and procedures are not standardized. Finally, this paper presents recommendations to prevent in the government procurement rent-seeking behavior: strengthen government procurement budget management, standardize the choice of government procurement, improve government procurement bidding mechanism and supervision mechanism, establish a unified e-government procurement.In this paper, literature research and case analysis, theoretical and practical case combination, which is the highlight of this study. By the theory of the "economic man" hypothesis, commissioned a good combination of agency theory and rent-seeking theory and the high price of high-speed rail procurement case, a more thorough analysis of the rent-seeking behavior in government procurement.