Public Policy Transaction Cost and Governance Mechanism——A analysis of transaction cost on public policy research

The theory of transaction cost is a useful framework for analysis of political issues.From transaction cost theory perspective,the public policy can be seen as a political deal between policy-makers and citizens of voters,and its essence is a political contract.Because of the human factors and trading environment factors of contract,such as limited rationality,opportunism,information asymmetry,uncertainty and complexity and so on,there are a large number of transaction costs in public policy formulation and implementation.The analysis of transaction costs and design of governance mechanisms on saving transaction costs will help us to improve the policy efficiency and realize the policy goal.