Keywords: government procurement; Entrusted agent; manage
First, the principal-agent chain in government procurement.
The stakeholders involved in government procurement mainly include taxpayers, payers, governments at all levels, financial departments at all levels, competent departments, administrative institutions and suppliers. Under the centralized procurement operation mechanism, the above stakeholders form the following principal-agent relationship, forming a principal-agent chain in the process of government procurement management: (1) At the top of this principal-agent chain is the principal-the provider of government procurement funds (taxpayers), and taxpayers entrust public funds to the government, a national public affairs management institution, through legal procedures. In this way, the taxpayer-government agency relationship is formed. (2) Because the field of government management is very extensive, it is impossible to cover everything, so we divide the functions according to the powers and further entrust the financial management functions to the financial department. In this way, the agency relationship between the government and the financial department has been formed. (3) The financial department is mainly responsible for the formulation and supervision of government procurement laws and policies, the formulation and review of supplier qualification standards, the training and management of procurement officials, the release of procurement information, procurement statistics and publication. The financial department can't do everything, so it decentralizes the management of government procurement, sets up specialized agencies (such as government procurement centers) within it, and entrusts government procurement agencies with bidding or non-bidding procurement for procurement budget items reviewed and approved by the National People's Congress. In this way, a three-level agency relationship between the financial department and the specialized government procurement agencies has been formed. (4) Finally, specific government procurement activities are carried out by government procurement officials with special knowledge, thus forming a four-level agency relationship between government procurement officials and specialized government procurement agencies.
To sum up, a long four-level principal-agent chain of "taxpayer-government-financial department-specialized government procurement agencies-procurement officials" will generally be formed in the process of government procurement. At the top of this principal-agent chain is the taxpayer, who is the provider of government procurement funds and the procurement official is the final agent. As the initial client, the taxpayer actually has no corresponding decision-making power and management power in this process. It can neither make purchasing decisions and sign contracts in the market, nor profit from them. Therefore, what really plays a decisive role in this chain is actually a government procurement official who has professional knowledge and is specifically responsible for procurement activities. He buys and sells with suppliers. Government procurement officials are rational economic men, and they also pursue the maximization of their own interests. When there is a conflict with the client's interests, he can't strictly enforce the government procurement laws and regulations, and ensure that the government procurement function can be realized to the letter. It is precisely because of the existence of the principal-agent chain formed by the multi-level agency relationship in government procurement that the principal-agent problem arises because of the inconsistency of utility functions between agents at all levels and principals, which naturally leads to the incompatibility of incentives between principals and agents.
Second, the analysis of the causes of the principal-agent problem in government procurement
The principal-agent problem in government procurement is essentially the failure of the principal-agent problem of public power, and the main reasons are as follows:
(A) serious information asymmetry
In the principal-agent operation of public power, whoever has more information about the operation of public power will have potential advantages in this implied principal-agent contract and its implementation. Because of the strong professionalism of government procurement, agents, especially government procurement officials, as the proponents of government procurement schemes, generally have more private information than clients, and clients must pay much higher costs than agents to obtain highly professional government procurement information. In addition, it is difficult for the principal to observe the collusion between agents, and even if it can be observed, it will cost a lot. Therefore, in government procurement, the decision of the principal is often subject to the agent as the information provider, and the scope, method and quota standard of procurement are actually decided by the agent. It can be seen that this information asymmetry provides the agent with the possibility of deviating from the client's entrustment goal.
(b) Incomplete contract
The principal-agent relationship is essentially a contractual relationship. In the process of implementing government procurement, clients and agents can regulate their behavior by signing contracts. The principal-agent relationship in the process of government procurement exists in the form of long-term contracts, which is incomplete. It is impossible to predict all possible situations and stipulate the responsibilities of all parties in various situations. In addition, it is impossible for officials of functional organizations to repeat their products in a procedural and regular way like enterprises, so officials must be given full freedom to dispose of products. For example, some laws and regulations need to be explained at every stage of policy implementation, but they cannot be very detailed, so they will deviate from the original intention of the law in the process of implementation. In the case of asymmetric information among the government, financial departments, specialized procurement agencies, procurement officials and suppliers, agents can seek the maximization of personal utility through the information they have, and use incomplete contracts and liquidity rights in government procurement, thus harming the interests of taxpayers.
(C) the opportunism of client supervision and the failure of principal-agent in government procurement
In order to ensure that the government or procurement officials exercise the procurement right according to their own wishes, the client must supervise the entrusted agency operation of the procurement right. However, due to the fact that this part of the procurement power entrusted to procurement officials has changed from private products to public products, the principal-agent operation of procurement power has great externalities, which leads to the client's weak supervision over procurement power agents. The reason for this is the following：
1. High regulatory costs
Among taxpayers, governments, financial departments, specialized government procurement agencies and procurement officials, procurement power is entrusted by multiple layers. With the increase of principal-agent chain, the implementation and supervision costs of procurement power also increase accordingly.
2. The director's opportunistic behavior
Because the principal of purchasing power is the taxpayer, and everyone's private rights in the public domain are limited, so each principal has no enthusiasm for supervision. The main reasons are as follows: first, the failure of purchasing power principal-agent operation has caused great losses to society, but the average distribution to each principal is relatively small. Secondly, it takes time and energy for each client to supervise the implementation of the procurement right, and the opportunity cost of this part is very large for himself. Even if he is well supervised, he can ensure that the procurement officials carry out the procurement power according to the wishes of all clients, or investigate and deal with the corruption of procurement officials, but he has little benefit from it. This is not worth the loss for every client who conforms to the nature of rational economic man. In this way, supervisors will not have the enthusiasm for supervision, nor will they try their best to reduce or increase the cost of supervision. Therefore, everyone will take opportunistic behavior, hoping that others will supervise, and they will "hitchhike" and enjoy success, resulting in unsupervised. Finally, in the case of multiple clients, different clients enjoy different information, and it is difficult for multiple clients to reach an agreement on the distribution of cooperative benefits, so it is difficult to adopt a selective incentive policy of supervision among most clients.
To sum up, it is precisely because of information asymmetry, incomplete contract and regulatory opportunism that the principal-agent relationship formed in the process of government procurement will cause the problem of agency failure, which makes it a reality to combine the demand of procurement officials for personal wealth with the incentives of suppliers for their own interests and maximize their respective interests through rent-seeking.