Abstract: Enterprise residual claim is the core element of the principal-agent incentive theory and the incentive contract of modern enterprise managers. However, the discussion on the pricing of residual claim and its incentive contract has not been finalized, and the problem of efficiency loss of incentive contract has not been solved. In view of the development trend of the innovation form of the incentive system of residual claim in reality from relying on pure human capital to the incentive contract based on the dual investment of human capital and material capital, based on the classical principal-agent model, we reconstruct a manager incentive contract model by introducing the improved idea of residual claim being partially bought by managers themselves and relative performance evaluation. The research shows that the managers' private investment in their company and relative performance evaluation with the benchmark of industry average performance can improve the efficiency of the incentive contract. The institutional implication of the conclusion is that the contractual arrangement that includes free provision of and managers' payment for residual claim, plus relative performance evaluation, is an important way to innovate the property right incentive mechanism of core human capital in modern enterprises.

Key words: residual claim, principal agent, incentive contract, managers' private investment, relative performance evaluation