The Asymmetric Regulation And Competition Of The Network Industry

The asymmetric regulation and competition of the network industrySince the 1950s and the 1960s, a tide of liberalization, which originated from developed market economy countries, has swept across the world. It affects the industrial organization in two respects: one is the transformation from the regulation institution to the incentive institution; the other is deregulation and the elimination of the government interference. From the end of the 1980s, with the continuously deep-going of our economy system reform, great changes have taken place in our regulation institution of the network industries, such as electricity industry and telecommunications industry. On the purpose of promoting the competition, the government not only relaxes the regulation of entry, but also implements the asymmetric regulation on the leading enterprises inside the trade.The practice of reform gives the theory research a valuable story of "Real World", which brings about massive literatures on the relationship between the regulation and the market, between the regulation on network industry and industrial organization, and so on. Chinese scholars' research doesn't simply stagnate on importing a vast number of latest research achievements from abroad, but has a certain progress on applying these theories to the practice of our reform. This thesis focuses on the present condition of theory research, that is the special constraint on the network industrial competition, the effect of the government's institution changes. This stagnation of the theory research directly results in the dispute on how to reform the regulation institution, even though this dispute partly is caused by the fact that some researchers tend to serve a given interest group.Hence, the purpose of this thesis is to indicate the performance of the regulation institution on the natural monopoly, the equilibrium of the institution changes, its path and its limitations, which could make up the shortcomings and provide an analyzable frame for the dispute. For this reason, the thesis attempts to construct a theory model of a dynamic evolutional market structure. And its main content is to analyze the strategic actions of entry and incumbent enterprises, as well as to emphasize the evolution of the natural monopoly of the market structure with the change of the government's regulation institution. And by this it interprets the changes taking place in China's telecommunication and forecasts what would happen next.The first part of this thesis is the fundamental theory research, which mainly introduces the analytic frame of the government's regulation and the market structure. It includes: there are two aspects of the definition of the market structure: centralization ratio and barriers to entry. The evolution of the market structure could be examined by the change of the centralization ratio, which draws forth that the entry becomes the main action content. In a traditional monopoly industry, entry could result in the strategic obstruction by the incumbent firm. So, the entry takes place in a condition that the incumbent firm actually adopts an accommodation strategy. The influence of the government regulation on it is to promote or restrain the entry by means of making some changes on the cost of the strategy action. Once the entry hashappened in reality, in order to accelerate the increasing level of the market competition (that is to speed up the entry), the government could assume the asymmetrical regulation, which is to alter the market quota by ways of changing the competitive power of market competitors. Such kind of institution might be a consideration on the public interests or the outcome of the institutional competition among interest groups. In the view of the assumption of the public interests, the welfare significance of the asymmetric regulation institution depends on the compare equilibrium between production efficiency and allocation efficiency. In the view of the assumption of interest groups, the pursuit of the asymmetric regulation instituti...