Game Analysis of the Dual Principal-agency Relationship in Centralized Procurement

摘要

As a production of the modern market economy, government procurement has a history of over 200 years in Western countries. More than one method used for optimizing expenditure management, government procurement exerts a positive effect on regulating a state’s gross resource, resource structure and price level. As a result of the dual principal-agency incentive mechanism adopted in Chinese government procurement, problems such as conflicted utility objectives and lowered efficiency of principals have cropped up. Using the non-cooperative game theory, this paper makes an analysis of the “principal risk” in the dual principal-agency of the government procurement, and proposes solutions to the problems of principal, which can be used as a reference for the government procurement practices.