Study On Price And Market Structure Regulation Reform Of China Railway

After new China was founded, our government divided the rail transportation network according to various regions, and established the corresponding railway administration to manage. In the era of planned economy, this kind of operation and management system had not exposed too many questions, and also has a certain efficiency advantage. However, after our country implemented the market economic system, the disadvantages of this system have gradually revealed. At the same time, the state implemented a strict price regulation and market access regulation, set a low transport price, and limited the private capital and foreign capital to enter railway transportation. After the reform and opening, the highway and civil aviation rose rapidly, and broke the monopoly status of railway transportation slowly. In this context, the development of railway transportation industry had entered hot water:high transportation costs, less competitive, the gradual loss of market share, the lack of construction money, etc. These all become to be the "bottleneck" link of economic development.To solve these problems, the government has taken a series of reform measures:relax price regulation and access regulation, implement structure reorganization, etc. With a bit of reform here and there in the original mechanism, the reform had not broke the monopoly or introduced competition mechanism, thus it had little effect. Therefore, the research that focuses on price and the market structure regulation reform of railway transportation has great practical significance.This paper’s general research ideas as follows:firstly, find out constraint condition and goals of the railway transportation’s regulatory reform, and then seek out the corresponding reform policies and measures.Among them, the first chapter described the research background, the goal and significance、tools、method and existent insufficiency. The second chapter combed each main theory of development of regulation theory, and researched and evaluated currently existing literature, which thus laid the foundation for analysis of government regulation of railway transportation.The third chapter analyzed the goal and constraint conditions of government regulation. These constraints mainly include the basic property of railway transportation, the current situation of the development of the economic and society. Based on the analysis of these constraints later, this paper maintained that in the aspect of regulation reform targets, the government puts the maintenance of social stability and fair target in more important position.The fourth chapter studied the price regulation reform of China railway transportation. First of all, various pricing way of natural monopoly industry are summarized, and also analyzed and compared then. Secondly, China’s railway transportation price regulation reform history and current practice price system were summarized, and the price regulation reform effect was analyzed empirically. Finally, suggestion was put forward in view of China’s price regulation reform:(1) China’s railway transportation price should be fully considered the demand factors, and implement nonuniform pricing in a larger range;(2) Enforce the highest price system and encourage companies to improve production efficiency;(3) In order to protect the public interest and maintain social stability and fair, in terms of public welfare transportation service, the government should be liable for supply responsibility, and bring franchise bidding mechanism into force, pay for the services or subsidy the enterprise.Chapter5studied the problem of China railway transportation market structure reorganization. The market access and exit regulation of natural monopoly industry is analyzed firstly, secondly, the railway transportation market structure regulation reform history was summarized, and the reform effect was evaluated. Thirdly, reorganizing goals of railway transportation market structure are analyzed, and the advantages and disadvantages of different restructuring plan are studied comparatively in detail. At last, the ideas and policy of railway transportation market structure reorganization are proposed:(1) the market structure reorganization should need two forces to promote which involved the government’s strong push and the market mechanism.(2) Asymmetric regulation should be exercised to make new entrants have effective competition ability early; (3) Incentive regulation should be exercised:implement the highest price regulation in network access service; a regional benchmarking regulation should be practiced to reduce the enterprise information rents and improve internal efficiency.The sixth chapter discussed the implementation of price regulation cooperated with market access regulations. First of all, the implementation of price regulation cooperated with market access regulations and the price regulation coordinated between the modes of transportation are analyzed. Secondly, it puts forward "the separation between the government and the enterprise" and the Ministry of Railways industry management function merges into Ministry of Transportation together with adjustment of regulation target.This paper’s main contributions or the possible innovations are:(1) Present the objective function of China’s railway transportation regulatory reform. As the government in order to protect the public interest and improve social welfare, social stability and fair are put a more important position in regulatory reform.(2) The various pricing way of natural monopoly industry are arranged and evaluated, and the price regulation reform history of railway transportation are summarized and appraised. Propose a "dichotomy" that both can maintain social stability and fairness, and improve the market performance:the government shoulders the responsibility of commonweal service and put franchise bidding mechanism into practice, pays for the services or subsidy the enterprise; in order to fully reflect the demand factors, nonuniform pricing is implemented in a wider range; carry out the highest price system, offer incentive for enterprise to reduce the cost and improve the efficiency.(3) Diverse kinds of reorganizing plans of railway transportation market structure are analyzed and compared, and the history of the restructuring is summarized and evaluated. Puts forward the ideas and means for railway transportation structure reorganization:the government’s strong push+market force’s drive, it means using the government’s mandatory power to restructure the state railway to form a competitive market structure in a short time; introduce new enterprise and utilize market competition mechanism to achieve competitive markets structure. This paper also puts forward relevant policy suggestions: implement incentive access pricing, encourage enterprises to improve production efficiency; execute the asymmetric regulation to support potential enterprise to possess the effective competition ability as early as possible.(4) This paper have also studied the implementation of price regulation cooperated with market structure regulations and considered that the supporting implementation can avoid the deterioration of social welfare or improve social welfare, our countries should relax railway transportation price regulation, and practice equal price regulation on the transportation industry; maintain that the measures which contain the separation of the government and the enterprise, the Ministry of Railways industry management function merger into Ministry of Transportation and adjustment of regulation target are favorable for the development of railway and coordination of the development for diversified mode of transportation.