A Study On The Nature And Effects Of Market Segmentation In China

Acted as exchange platform for commercial goods, the market is not unified since it is originally born, but is divided into many small units. Becoming more and more integrated is a commonly gradual historical course for all the market system, which is not a special phenomenon happened in the period of Chinese market transformation. However, the imperfect system will amplify the degree of segmentation during that period. Surely the factors affecting market segmentation are various, including both systematic factors(e.g. formal system of laws and regulations, etc) and non-systematical factors(e.g. nature environment and technology etc.). With the development of the economy and the expansion of market scale, the unified market would be beneficial for the free flow and utilize allocation of resources in the market.So far, there is few systematic works have been done by researchers. Considering the inadequacy of existing studies, this paper tries to restructure the theoretical analytical framework of market segmentation. Using the theories of political economics, regional economics, economic sociology and new economic geography etc and applying scientific research methods of spatial econometrics, panel data analysis etc, this paper also conductly study theoretically and empirically. It will be a benefit not only to the academy, but also to give the politic advisory for breakthrough market segmentation and establish modern market system. During our study, we tried to answer the following questions: is market segmentation a unique phenomenon in the economy transferring period? How is it defined and classified? How does it emerge? What are the factors that affect market segmentation? By which means we can break it? What are the effects of market segmentation? Etc.This article adheres to Marxist economics as the guidance. According to a certain logic structure, we carried out the research following a comprehensive theoretical framework, attempted to answer what is the nature of market segmentation. Our basic logic arranges as follow: general theory review—establish the theoretical framework of market segmentation, clarify its definition and classification(“what”)—analysis its causes and effect empirically(“why”)—exam the effect of market segmentation(“how”)—policy suggestion(“what to do”).Our study route is: firstly, through studying the deficiencies of existed theory, this paper redefines and classifies the market segmentation, and analyzes it causes; then, after comparing with the existed research methods, this paper picks the general accepted and modified relative price index, measures and analyzes the trend and its effects; after that, considering its effects on national or regional economy development, this paper tries to analysis its social economy effects; finally, this paper gives policy recommendation based on the success experience of managing market segmentation from developed countries. Therefore, this paper’s roughly structure is:Chapter 1, introduction. Mainly about the background, significance, general literature review, research method, content, structure and innovation, and so on. Regarding the literature review, we sorted out, categorized and commented on papers from both domestic and aboard. This paper includes four aspects:(1) classify the measuring methods, analyze the pros and cons for each of them;(2) analyze the factors affecting market segmentation, states the limitations in existed papers;(3) conclude the economic effect of market segmentation from the perspective of economy opening and economic growth;(4) summary the social effects of market segmentation from the perspective of social welfare.Chapter 2, market segmentation theory and theoretical framework. In this chapter, we trace back to the source theory to provide the theoretical support and give theoretical analysis framework of market segmentation. Interpretation theory mainly follow two aspects:(1) Introduce of Marxist theory about market segmentation. Firstly, analyze of the market and market rules. Secondly, analyze the relationship between the division of labor, productive forces and production relations. Thirdly, elaborate the changing relationship between government and market by Marxist classical writers.(2) Review the western economics theory of market segmentation. Firstly, the defects of the existing market segmentation theory analysis framework. Secondly, the construction of market segmentation theory analysis framework.Chapter 3, the nature of market segmentation. Firstly, this chapter redefines the market segmentation and categorizes market segmentation as: natural market segmentation, technical market segmentation and institutional market segmentation; Secondly, this chapter analyzes the causes of domestic market segmentation, taking the North-East market as example; Thirdly, this chapter uses the modified method of relative price index to test the degree of market segmentation and its trend; At last, basing on the factors that affecting market segmentation, initiating from the effectual means to break market segmentation, this chapter analyzes the effects of infrastructure construction and the tax system reform to market segmentation.Chapter 4, economy effect of market segmentation. This chapter focus on economy effects of market segmentation on national and regional economy. Firstly, make qualitative analysis of the advantage and disadvantage of economy effects of market segmentation on national or regional markets; Secondly, exam the relation between market segmentation and economy growth, and explain of its ways; The last, in the context of regional development strategic, exam the relation between market segmentation and regional economy growth, and explore the reason of regional discrepancy.Chapter 5, social effects of market segmentation. This chapter focus on social effects of market segmentation on national and regional social development. Firstly, this chapter makes qualitative analysis of the advantage and disadvantage of social effects of market segmentation on national or regional markets; Secondly, this chapter checks social effects of market segmentation from the perspective of social welfare system, by which method to further elaborate the effect of market segmentation on the benefit our residents received from domestic market.Chapter 6, success experience of managing market segmentation from foreigner countries and suggestions of governing market segmentation. Reviewing the success experience of managing market segmentation from developed countries and combining with the conclusion made from empirical finding, this chapter gives some relevant policy recommendations.Finally, conclusion.