Research On The Influence Of SOEs' Upstream Monopoly To China's Resource Allocation Efficiency

For more than 40 years of reform and opening up,the level of competition in China's downstream product sector has increased substantially,and the dominant position of the market mechanism in resource allocation has gradually been established.However,the upstream factor sector is still largely in a state-owned monopoly,and the market's mechanism for allocating resources is subject to many restrictions.This not only hinders the market entry of high-efficiency non-state-owned enterprises,widens the income gap between industries,but also hinders the process of industrialization,affects the quality and sustainability of economic growth,and ultimately damages the welfare level of society as a whole.At the same time,as China entered the ranks of "upper and middle-income countries" and faced with a complex domestic and foreign environment such as the disappearance of the demographic dividend,the tightening of resource and environmental constraints and the shrinking of external demand,China has long implemented The "extensive" economic growth mode in which large-scale investment has driven economic growth has been unsustainable.To promote a new round of high-quality economic growth,we must turn to relying on the "intensive" economic growth mode whose main factor is the increase in total factor productivity.In addition to the company's own technological progress,the improvement of resource allocation efficiency is another important way to achieve the improvement of total factor productivity,and even an even more important way.This leads to a very important question:what role does the upstream monopolistic market competition structure and formation process of state-owned enterprises play in the evolution of China's resource allocation efficiency?Furthermore,at this stage,can we advance the reform of state-owned enterprises,break the monopoly of upstream state-owned enterprises,and further improve the efficiency of China's resource allocation,thereby promoting a new round of high-quality economic growth in China?Existing literature focuses on the efficiency loss of the monopoly of the state-owned enterprise and its efficiency loss to the overall economy,but it largely ignores the fact that the state-owned enterprise monopolizes the upstream of the industrial chain and its impact on downstream enterprises and the overall economy.Few literature are based on China's specific "asymmetric competition structure formed by enterprises of different ownerships in the upstream and downstream of the industrial chain" to study its impact on resource allocation efficiency in China.Obviously,the breakthrough of this issue is directly related to the further deepening of reforms and future economic development,and is an important research topic that needs to be solved urgently.This article is titled "Research on the Influence of State-owned Enterprise'Upstream Monopoly to China's Resource Allocation Efficiency".First,it theoretically analyzes the mechanism of state-owned enterprise' upstream monopoly on China's resource allocation efficiency,and distinguishes the effect of state-owned enterprise'upstream monopoly on China's resource allocation efficiency:"direct inhibition effect' "indirect drag effect' "competitive exit effect" and "spatial effect' and construct an industrial organization model to analyze the monopoly competition relationship between different ownership enterprises in the upstream and downstream of the industrial chain from the mathematical level.Secondly,on the basis of the existing state-owned enterprises' upstream monopoly and China's resource allocation efficiency measurement model,this paper improves it based on the actual situation in China,and applies the improved model to estimate China's state-owned enterprise'upstream monopoly degree and China's resource allocation efficiency.Finally,this paper uses panel data at the provincial level in China to empirically investigate the direction and extent of state-owned enterprises' upstream monopoly on China's resource allocation efficiency,and examines the impact of spatial factors on the relationship between the two based on the spatial Dubin model.The study found that the influence of state-owned enterprises' upstream monopoly on the distortion of China's factor configuration is inverted "U" shape,and the specific direction depends on the relative magnitude of the positive and negative forces.On average,the degree of state-owned enterprises' upstream monopoly and the level of distortion of factor allocation are reversed:when state-owned enterprises climb upstream along the industrial chain,the improvement in resource allocation efficiency caused by the"competitive exit effect" is greater than the deterioration of resource allocation efficiency caused by the "direct suppression effect" and the "indirect drag effect" the degree of distortion of factor allocation has decreased;when state-owned enterprises enter the downstream industry along the industrial chain,the deterioration of resource allocation efficiency caused by the "direct suppression effect" and the "indirect drag effect" is greater than the improvement in resource allocation efficiency caused by the"competitive exit effect",and the degree of distortion in factor allocation tends to rise.Relatively speaking,state-owned enterprise' upstream monopoly improves the distortion of labor factor allocation more than the distortion of capital factor allocation.The regression results of the spatial model show that ignoring the spatial effect between regions will overestimate the direct impact of state-owned enterprise'upstream monopoly on resource allocation efficiency;after joining the spatial effect between regions,due to state-owned enterprise' upstream monopoly will also play a role in adjacent regions' resource allocation efficiency,it will strengthen the influence of state-owned enterprise' upstream monopoly on resource allocation efficiency.Based on the above research conclusions,this paper believes that by advancing the reform of state-owned enterprises and breaking the administrative monopoly of upstream state-owned enterprises,it can further improve resource allocation efficiency in China and promote a new round of high-quality economic growth in China.The key to breaking the state-owned enterprise' upstream monopoly is to remove the government's administrative protection of state-owned enterprises.To this end,it is necessary to clarify the role of the government in the market economy system,redefine the role of the government,clarify the market positioning of state-owned enterprises,and accelerate the market-oriented reform of factors.Compared with the existing research,the innovation of this article is mainly reflected in the following two aspects:1.This article starts from the market competition structure of China's specific state-owned enterprise's upstream monopoly,and studies its impact on resource allocation efficiency from both theoretical and empirical aspects.According to the author's search of relevant literature,this is the first time in existing research.Existing researches on resource allocation efficiency mostly start from the horizontal competition structure among enterprises,examine the horizontal competition of different types of enterprises in the industry,and focus on the impact of various factor allocation distortions or policy distortions on resource allocation efficiency and social welfare.Although a few literatures have noticed the phenomenon of state-owned enterprises monopolizing the upstream of the industrial chain and studied its impact on economic growth and excess profits of state-owned enterprises.However,there is no direct study on the impact of state-owned enterprises' upstream monopoly on resource allocation efficiency in China.2.This paper proposes a comprehensive analysis framework for the state-owned enterprise'upstream monopoly affecting resource allocation efficiency.It comprehensively examines the impact of state-owned enterprise'upstream monopoly on resource allocation efficiency from the perspectives of "direct suppression effect","indirect drag effect","competitive exit effect" and "space effect".Existing literature discusses the effects of state-owned enterprises on resource allocation efficiency and overall economic growth from the relatively low efficiency of state-owned enterprises and the indirect drag of state-owned enterprises on private enterprises,but lacks dynamic and spatial levels of investigation.On the one hand,from the perspective of long-term dynamic effects,the rising upstream of state-owned enterprises means that state-owned enterprises continue to withdraw from competition in the downstream market,thereby releasing a large number of production factors,opening the threshold for entry of non-state-owned enterprises in the downstream market and removing the obstacles for the effective exertion of downstream market competition mechanisms.From this perspective,the industrial competition pattern and its formation process of the state-owned enterprise' upstream monopoly have played a positive role in the evolution of China's resource allocation efficiency.On the other hand,the economic variables between the regions are not independent of each other.In reality,there are extensive economic and technological links between the regions.The state-owned enterprise' upstream monopoly in the regions not only affects resource allocation efficiency in this region,but also affects other regions.In particular,the impact of neighboring regions on space,and changes in resource allocation efficiency in other regions will adversely affect resource allocation efficiency in this region.Therefore,in order to comprehensively examine the effect of state-owned enterprise' upstream monopoly on resource allocation efficiency,it is necessary to incorporate dynamic and spatial factors into the analysis framework.