Interest Groups In The Reform Of The Regulation Of Natural Monopoly Industries In China

From the perspective of new political economy, applying the theory of interest group, my doctoral dissertation analyzed the basic characteristics of three interest groups among the regulation reform of the natural monopoly industries in our country. The dissertation built up three models to describe the behavior mode of interest group member, the competitions among groups and their effect on social welfare, and some conclusions are drawn. Based on the former work, this dissertation also analyzed the typical cases of some natural monopoly industries, such as electrical engineering power industry, telecommunication, postal service and railway industry. Combining theoretical analysis and empirical tests, the dissertation got some policy suggestions to direct the regulation reform of the natural monopoly industries in China.Compared with other industries, natural monopoly industry has unique economic and technical nature, and the regulation on it firstly stemmed from the observation of this nature. Nevertheless, the enactment and implement of any policy is backed up by political force. Besides economic and technical factors, political factor to a large extent affects the regulation process, but also is a decisive one, especially in such a transitional country as China, for that reform is an adjustment of the present interest pattern. In political system, members who have the same interest form group to realize their interest claim through group activities. Interest group theory indicates that interest group plays an important role in the political process. Our political regime is different from that of western countries, but recent years, our social stratum has become divided and more interest groups occurred. The regulation reform has changed the former interest pattern, and the interest conflict among groups is becoming more acute with the impeding reform.Consumers, monopolists and regulators compose the three interest groups in the regulation reform of natural monopoly industry. They have different characteristic, scale, political input and political influence, and they game with each other for their own group. Regulation policy is the equilibrium result of their political influences.Consumer group of natural monopoly industry is large, but its members are scattered, and each member has great divergence, as a result, its influence is weak. The model of interest group member's behavior mode proves that consumers' political effort level is always less that the optimum. The more scattered the consumers are, and the higher their income is, the less their individual effort is. Empirical studiesindicate that the consumers of natural monopoly industry in our country yet have not formal organization, nor any effective political path, and they are in an absolutely minor position. Therefore, maintaining the principle of universal service is the prerequisite of our reform. We must make efforts to enhance the political influence of consumer group and encourage consumers to participate the enactment and implement of the regulation policy. By this method, can they only be satisfied.Monopolist group of natural monopoly industry is small, its members have little divergence and have good communication among each other, and as a result, it has strong political influence. The model of interest group's competition proves that with the augment of the group, at the beginning its political pressure becomes larger, then less, and ultimately steady. When the budget of government is equilibrium, competitive interest groups' political influence is negative correlated, and the efficiency loss of redistribution will magnify the political pressure of consumer group, but lessen that of monopolist group. The co-operation among competitive interest groups will lessen the expenditure in the political competition. The monopolists in our country made tremendous benefit by their monopolization. The goods and service of theirs is of high price and inferior quality. State has invest much into the natural monopoly industries, but these enterprises acquired poor performance, on the contrary, their staff got high salary disproportionate to their capabilities. At present, we should not blindly mimic the western countries to loosen regulation, but strengthen the regulation. We may explore the methods of incentive regulation to prevent the social welfare loss as possible and effectively incentive the monopolists to supply their goods and service.Regulation group includes tiers of governments and governors. They have dual subjects of both political and economic. As the subjects who formulate and enforce policy, regulation group is the supplier in the political market, and have the strongest political influence. The central government of our country is the representative of public interest, and local governments and governors to large extent are representatives of industry interest and local interest. The enactment and implement mechanism of regulation policy embodies the conflict inside regulation group. The key to the regulation reform is institutional build. Because regulators have dual subjects and natural relevance between governments with monopolists, the regulation mode directed by governments will not benefit the optimum of social welfare. Therefore, the urgent regulation reform of natural monopoly industry is not privation,...