Optimal Market Structure Of Technical Innovation Under Heterogeneous Product Terms

The topic which market structure will more benefit innovation has argued for many years. Some economists represented by Schumpeter hold monopoly benefit more to innovation; to the contrary, economists represented by Arrow believe competition benefit more to innovation; however, Mansfield et.al. consider that innovation is more concentrated in the medium market structure's firm. At the same time there are many other economists, for example, Scherer,Dasgupta and Stiglitz, et. al. they consider this problem from some more delicate perspective, actually they believe the relation between market structure and innovation changes with the conditions, that is to say, their relationship is uncertain. In a word, the relationship between market structure and innovation has not come to an agreement. Importing the variable of product heterogeneity, considering the market scale, efficiency of R&D, this paper put the paradoxical viewpoints into a uniform framework. The research shows:when the parameter changes the optimal market has a continuous changing process from monopoly to complete competition.According to the demand of theory research and the trait of Chinese technical innovation, this research builds a framework of optimal market structure of technical innovation under heterogeneous product terms, it involves the optimal market structure of product innovation and process innovation. Then following the statistical analysis on the running state of Chinese high technology industry, this research does an empirical analysis using the data of Chinese high technology industry. After that is the optimal market structure of absorption and reinnovation. The research on optimal market structure of heterogeneous product innovation shows: the industry in which the difference of product is small, or the innovative product has a high potential profit, or the innovative product has a low substitution rate to the original product more benefits the innovation, when its market structure has a higher degree of monopoly; the industry in which the difference of product is big, or the innovative product has a low potential profit, or the innovative product has a high substitution rate to the original product more benefits the innovation, when its market structure has a higher degree of competition; the market structure and innovation have a "inverted U" relation when the value of those parameters is medium.The research on optimal market structure of heterogeneous process innovation shows: The relationship between R&D input of firm and market scale, the degree of product differentiation, original cost of product is positive correlation, the relationship between R&D input of firm and R&D spillover, market competition is negative correlation; The relationship between R&D input of industry and market scale, the degree of product differentiation, original cost of product is positive correlation, the relationship between R&D input of industry and R&D spillover is negative correlation, the relationship between R&D input of industry and market competition is inverted U; The relationship between R&D efficiency of firm and market scale, the degree of product differentiation is negative correlation, the relationship between R&D efficiency of firm and original cost of product, R&D spillover, market competition is positive correlation; The relationship between R&D efficiency of industry and market scale, the degree of product differentiation is negative correlation, the relationship between R&D efficiency of industry and original cost of product, R&D spillover is positive correlation, increasing with the R&D spillover, the relationship between R&D efficiency of industry and market competition varies from negative correlation to positive correlation.The research on the optimal market structure of absorption shows; absorbing the imported technology is a costly learning process for the enterprises, so it can't happen automatically, how much the enterprises pay attention to absorbing the imported technology is determined by several factors. The theory research shows:the ratio of expenditure which the enterprises pay to absorb and import technology has a negative relationship with the world technical progress rate of given industry, and positive relationship with the firm's human capital stock and the market competition of the given industry. The experience analysis of Chinese high technology industry also verifies these conclusions on the whole, and from the perspective of absorption, the market structure of Chinese high technology industry lacks competition.The research on optimal market structure of heterogeneous reinnovation shows:whether technology import could boost autonomous innovation or not depends on the contest of strength between the sum of production effect, learning effect and the diffusing effect; Product difference plays a role of fire wall; The variables of market scale, research capability et al can change the critical market structure which technology import could boost autonomous innovation. The data of Chinese high technology industry supports these conclusions on the whole, at the same time the research on reinnovation of Chinese high technology industry shows:comparing with the optimal market, the market structure of Chinese high technology industry lacks competition.To sum up, after importing the parameter of product heterogeneity, when the parameters change the optimal market has a continuous changing process from monopoly to complete competition. This conclusion is correct to product innovation, process innovation and absorbing reinnovation. The research on the each aspect of Chinese high technology industry shows:comparing the optimal market structure, the market structure of Chinese high technology industry lacks competition, so the government should promote the market competition of Chinese high technology industry.