Research On The Relationship Between Local Governments And Urban Investment Companies From The Perspective Of Principal-agency Theory

Since the reform and opening up,the rapid development of local economy and the increasing demand for infrastructure construction in the process of urbanization have made local infrastructure construction and fund management face great pressure.Both financial funds and management personnel are very scarce,so they are caught in a dilemma.In this context,urban investment Corporation came into being,undertook the investment and financing tasks of local governments,revitalized urban assets,and played a huge role in China’s urban development and urbanization construction.However,under the new policy environment,the original relationship between local governments and urban investment Corporation has gradually changed,and urban investment Corporation has ushered in a new development stage.From the perspective of principal-agent relationship,this paper analyzes the role positioning and relationship between B municipal government and local urban investment companies.According to the development status of B municipal investment company and the management status of B municipal government,it finds that there are excessive government intervention,excessive dependence of urban investment companies and low agency efficiency in the principal-agent relationship between the two.The principal-agent relationship between the two is not standardized,and the transformation of urban investment company is slow and lacks market competitiveness.This kind of irregular relationship is mainly caused by the unclear boundary of the principal-agent relationship,the lack of credit of the city investment company and the poor performance of the principal-agent contract.Finally,by analyzing the reasons for the irregular relationship between the two,the author proposes to optimize the functions of the client by clarifying the functional positioning of the government,improving the supervision mechanism of the government,integrating state-owned assets and other measures,and realize the self-improvement of the city Investment company by improving the construction of the company’s system and strengthening the credit construction of the city Investment Company.The most important thing is that the municipal government of B strengthens the incentive effect on the city investment company through the principal-agent relationship contract between the two.It is hoped that this will further standardize the relationship between B Municipal Government and the City Investment Company,improve the agency efficiency of the city Investment company,and enable the city Investment company to contribute more strength and play a more active role in the new stage of the economic development of B city.