Abstract Functions of market and government have been one of the focal debates in economics. Different theories present different models of economic governance. In general, market and government play their respective roles, but both of them may fail in modern economies. The purpose of mechanism innovation of economic governance is to seek a sound boundary where market and government integrate effectively. Both the achievement of “China model” and the result of financial crisis verify that market and government are two hands for modern economies. The basic strategy to make the post-crisis economic governance mechanism innovation should be as follow: the market plays an essential role in the allocation of resources; government’s function must be reflected in economic controls; at the same time a definite
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Received: 31 May 2011
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Corresponding Authors:
XU Li hong
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