Research On Mechanism Of Oligopoly Competition Based On Principal Agent Theory

With the rapid development of social economy, the information as an important factor, plays an important role in the economic activities. In 1959, information economicsa was generated with “Information economics Review” written by Marsac being published. Princapal agent theory what was a important branch of information economics was researched by many scholars with methods of theoretical research and empirical analysis during the last 50 years, which provides an effective solution for the non-information principal agent problem in real economic society. Especially in the oligarch market, game theory as a new discipline, has been an important analysis method almost in the all economics field since it was put forward by Von Neumann. The Nash equilibrium is made in the conflict of game participants with the game theory.In view of this, this paper expands the single period static principal-agent model to the dynamic multi task principal-agent model. In the same time, we expand the traditional duopoly competition model: Cournot model and Stackelberg model to the dynamic game model which N oligarches don’t have complete information. According to the special principal-agent relationship in Chinese banking industry, this paper makes the research on the oligopoly competiton market of four state-owned commercial banks(Bank of China, China Construction Bank, Agricultural Bank of China, Industrial & Commercial Bank of China), so that we can establish the excitation mechanism which can promote the balanced and healthy development of the market.The main works are follows:1. This paper expands the Cournot model which is static duopoly model with complete information and the Stackelberg model which is dynamic duopoly model with incomplete information to oligopoly model. At the same time, we find the optimal strategy in the infinitely repeated Cournot game, and the Nash Equilibrium in the Cournot model which has imcomplete information as well.2. In view of the current development situation of Chinese banking industry, we make the research on the oligopoly competition mechanism of the principal-agent problem between the four state-owned commercial banks and China Banking Regulatory Commission with game theory. The paper analyzes the profits of the four state-owned commercial banks in different business based on Cournot model and Stackelberg model. What’s more, we set up the multi task principal-agent model with the main referecne such as the effort level of agents, the market share of the four state-owned commercial banks, the incentive factors of China Banking Regulatory Commission and so on to make the motivation management mechanism in oligopoly competition market.In this paper, we research the principal-agent relationship in Chinese banking industry by game theory, which is the significant theoretical basis for healthy and stable development of Chinese banking industry, and has a positive effect on the equilibrium of the banking industry.