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The Game Analysis of the Arbitrary Control Behavior of Local Government and Enterprise about Corporate Irregularities

Author: WangJingPing
Tutor: HuangYan
School: Shantou University
Course: Industrial Economics
Keywords: Arbitrary control behavior of local governments Public Choice Game Theory
CLC: F224.32
Type: Master's thesis
Year: 2010
Downloads: 38
Quote: 0
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Abstract


In recent years , China's local governments control system is flexible , resulting in a confusion of corporate the unpredictable and regulatory control . Such as the control of the enterprise process control behavior of non - institutional and non- stability , coupled with the one-sided pursuit of economic performance on a performance evaluation system , and the lack of competitive constraint mechanism to promote and contribute to the local government in China , such as redundant construction , local negative competitive behavior of protectionism, vicious competition , resulting in the failure of the control of the local government . In this paper, based on public choice theory of cognitive biases to analyze local government arbitrary control behavior , from the perspective of local government behavior , the application of the method of analysis of game theory to build a model to analyze the interests of the game between the local government and enterprises . The results show that , under local government control is weak , and the lack of a social credit system , companies can rely on a number of violations to get greater performance , the local government provide the bribe amount is greater than its refuse bribery revenue , especially when the amount is large enough , the staff of the local government is difficult to resist the temptation of the enterprise may become a corporate umbrella , with corporate collusion , the control of the enterprise will also be more casual . In order to enhance the credibility of the conclusions , the article also use the analytical framework of game theory , tainted milk case . According to the study , this article has been several conclusions : First, rent-creating government and corporate collusion of local governments is an important reason to cause of government arbitrariness control behavior . Second , lower cost local governments strong control cost , improve the corporate irregularities confiscated cost effectively reduce violations . Third, the weakness of the lack of social credit and social intermediary organizations to promote the corporate irregularities and arbitrary control of the local government .

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CLC: > Economic > Economic planning and management > Economic calculation, economic and mathematical methods > Economic and mathematical methods > Operations Research in the economy > Game Theory
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