Competition In Network Industries

Network industries are the research object of the theory of industrial organization and economics of regulation all the time, but in the past ,the research mainly focuses on the regulatory behavior of government, pays less attention to the problems of economics of scale and competition of these industries. As the deepening of network competition, the regulatory manner of government is changing. Some think that the policy of competition is replacing the policy of regulation, but others think that the incentive regulation is replacing the old. Anyway, because of the great progresses of techonology and the great changes of system and market environment, the structures of network industries organization have changed greatly too. Naturally, all kinds of problems about network industries are paid more and more attentions to and studied. However, the theory framework of network industry organization has not been established completely, the competition of network industry still lacks steady ground of theory.Based on the above reality, the paper makes series of studies on the problems of competition of network industries with the modern economic theory.Firstly, the paper analyzes the basic technical and economic characters of network industries, which form the analytical foundation of the paper . The basic theory of competition in network industries are reviewed in the chapter too.About the reform of deregulation and promotion of competition, the theory of natural monopoly forms the important ground. Different kinds of recognition of natural monopoly will directly leads to different policies of industry organization. Natural monopoly is characterized by economies of scale and production cost subadditivity in the traditional and new theory of natural monopoly. The second chapter thinks that they are incorrect in the method of judging some industry as natural monopoly, They neglect some important transaction(system)cost factors. Once giving up the old analytic framework, we find that economies of scale and production cost subadditivity are neither necessary nor sufficient for natural monopoly. Based on the analysis on weaknesses of the traditional and new theory of natural monopoly, the chapter discusses the essential character of natural monopoly and educes some corresponding revelations about the reform of network industries.Through the re-recognition of the different characteristics of network industry between the physical and managerial level, the third chapter firstly provides a strategicframework of reform according to the true meaning of regulation. And then , the chapter mainly analyses l)the economic feasibility of the reform of structural separation in network industry, 2)the validity of introducing different forms of competition into network industry through separation reform and 3)the problem of corresponding regulation reform after separation.Partial monopoly market structure in some infrastructure industry will exist for a long period after deregulation reform. Based on nondiscriminatory pricing ,the fourth chapter analyzes the behavior of price competition in new market structure and the effect of price cap regulation policy. Its majior conclusion is that partial monopoly changes the enterprise's participation constraint of price competition,and that the relative scale of partial monopoly and conjectural faith have an important influence on enterprise's behavior of price competition , decide the characteristics of equilibrium and the effect of price cap regulation policy.There is competition not only between nonnatural monopoly services, but also between natural and nonnatural service. The fifth chapter analyses the basic character of regulation and competition between different services in network industries, and establishes the corresponding model of competition. Based on the model, the chapter analyses the influence of the different regulatory policies of every service and their coalesces on the behavior and performance of enterprise. The chapter , too, analyses the strategies of product difference of enterpri...