| Chinese Antimonopoly Law, Chapter 1, Article 7, the front part of which is as follows:"For the undertaking in the state-owned economy controlled industries to which are related to national economic lifeline and state security, and in the industries to which the state grants special or exclusive rights, the state protect their lawful operation. The state also lawfully regulates and controls their operation and the price of their commodities and services, safeguards interests of consumers, promotes technical progresses. " That mainly includes two points:Firstly, for the undertaking in the state-owned economy controlled industries to which are related to national economic lifeline and state security, and in the industries to which the state grants special or exclusive rights, the state protect their lawful operation, while these industries are usually called administrative monopoly industries. Secondly, the state also lawfully regulates and controls their operation and the price of their commodities and services, safeguards interests of consumers, which means that state has obligation to give effective price regulation on the monopoly enterprises, to safeguard the interests of consumers.For the government, the first point is easy to implement, because it only needs to set a higher administrative barriers to achieve. But for the second point, effective price regulation is hard to realize because of the information asymmetry and allying between government and enterprise. The monopoly price continues to exist, meaning that administrative monopoly has caused a great loss of efficiency. Actually, it isn't all the negative influence caused by industrial administrative monopoly, meanwhile the administrative monopoly will cause unfair social income distribution, lower enterprise production efficiency and the lack of international competitiveness of some important enterprises and so on. Administrative monopoly has caused so many negative effects, but its reform has been progressing slowly. There are many real obstacles for this, while the lag of theoretical studying, which can not provide a conclusion that is unified, clear, and looked as the reference for the decision-making departments, is also a very important factor.Through a literature work about the related research of government regulation and administrative monopoly, we redefined the concept of administrative monopoly, and put government regulation and administrative monopoly together to give a combined discussion. Administrative monopoly refers to the relevant subjects (mainly the government) using public power to restrict or reject the market competition, according to the neutral definition, the government regulation in industries regulated is a very typical administrative monopoly. Conversely, the serious administrative monopoly industries in reality, such as petroleum, railway, tobacco, telecom, electricity, etc, are the ones having government regulation background. This means that studying the administrative monopoly from the perspective of government regulation, not only avoided any omission of important problems on administrative monopoly, but also caught the crux of the problems on administrative monopoly.Government regulation, so as to solve the problems of market failure such as natural monopoly, provides the legality of administrative monopoly a theory basis. But the regulation failure makes the former goal hard to realize, instead, a lot of negative effects have emerged, which means the administrative monopoly in reality mostly is unreasonable, needs more reform. After these relationships made clear, we will study mainly around five basic problems, the main content of ideas is as follows:First is the judgement of administrative monopoly industries. From the chapterl, article7 of antimonopoly law, we give an extension to get the SCP-I-PR theoretical framework for the judgement of administrative monopoly industries:The industries, with market failure, accounting for the national economy and national security, have high administrative barriers to entry to keep the monopoly, which lead directly to higher nationalization share and industry concentration. Under the joint influence, the monopolistic behaviors breed, leading to higher profit. Meanwhile, in order to safeguard the interests of consumers, the government will also take measures as the price regulation to eliminate the monopoly profits. But because of the information asymmetry and regulation capture the actual effect is not good. Within the framework, so as to measure the degree of administrative monopoly, we can give five indicators including nationalization share, industry concentration, obvious price regulation or not, monopolistic behavior, industry profit. Combining with the relevant statistical investigation data, using two-dimensional analysis, a comprehensive weighted order and principal component analysis, we identified 9 strong administrative monopoly industries and 4 not strong administrative monopoly industries. According to the results, the main business income of strong administrative monopoly industries weights about 34 percents of the gross domestic product in the year 2006. Thus it can be seen that administrative monopoly industries play an important role in the national economy. More importantly, these industries are mostly related to national economic lifeline and state security, playing a basic role in the entire national economy more than general industries.Second is the rationality of administrative monopoly. Administrative monopoly industries can been divided into three basic types--natural monopoly, resources and processing and others, and public power often has sufficient reasons to intervene these industries to restrict and reject competition as national lawful monopoly. But the lawful background doesn't mean administrative monopoly is rationality. This study summarized three forms of unreasonable administrative monopoly--inappropriate administrative barriers to entry?the low efficiency of regulation act and administrative monopoly enterprises abusing their dominant market position. Through an empirical investigation and research, we point out that the latter two performances not only exist but also are the main forms of unreasonable administrative monopoly currently. In the demonstration of the low efficiency of government regulation act, the effectiveness of the price regulation was mainly discussed through econometric model, and we found that the price regulation fully fails; the effective influence is just to transfer monopoly profits to the enterprise internal employees.Third is the influence of the administrative monopoly. This problem can be divided into three aspects, efficiency losses, income transfer, production efficiency. In the aspect of efficiency losses, we noticed that whether administrative monopoly or economic monopoly, a monopolistic market structure and behavior is caused, and efficiency losses are essentially the same. Monopoly generally causes three kinds of efficiency loss--deadweight social welfare loss, internal production efficiency loss and the rent-seeking cost. According to statistical data, we gave a concrete estimation, and finally found that the overall efficiency losses caused by administrative monopoly are huge, about 10-15% of the GDP. In the aspect of income transfer, the transfer of income from consumers to monopoly enterprises contains two parts. Part one is the higher profits--industry concentration ratio is a positive impact, and nationalization share is a negative impact; the impact of former is much bigger than the latter, so there is strong positive relationship between administrative monopoly and profits. Part two is the higher average wages of staff—the impacts of industry concentration ratio and nationalization share are both positive; the former can been regarded that the higher average wages of staff is accompanied by higher profits which are caused by higher concentration ratio, and the latter can been regarded that the higher average wages of staff is the transfer of enterprise actual profits because of internal control. In the aspect of production efficiency, three kinds of efficiency index are discussed. Administrative monopoly has no significant effect both on labor productivity and on cost efficiency by dea method, even leads to low efficiency of dynamic. Anyhow, administrative monopoly either has no significant effect on production efficiency or reduces production efficiency not taking the innate endowment advantage of the administrative monopoly industries into account, and there are not any evidences that administrative monopoly will lead to high production efficiency. Therefore, the higher income caused by administrative monopoly cannot been explained as the result of high efficiency but can been attributed to monopolistic pricing.Fourth is the formation mechanism of administrative monopoly. Administrative monopoly has caused so much and big negative effects, but it hasn't been well reformed all the time. We can't help thinking, what on earth leads to the emergence and continuance of administrative monopoly? On the base of relevant theories about regulation economics, we built the basic model about the formation mechanism of administrative monopoly. Through analysis on the model, we found:all parties in the game of administrative monopoly are to pursue their own benefit maximization, especially the government in pursuit of their own interest gives birth to administrative monopoly; the government is not always the representative of public interests, allowing the rent-seeking,which is the most important e reason of administrative monopoly. In addition, we constructed a general demand-supply model and found that the degree of administrative monopoly in not only decided by the proportion of rent-seeking, but also by administrative monopoly profits, the information asymmetry, the environment of internal efficiency, the degree of government representing public, the property right structure, the strength of competition enterprises and consumers and so on.Fifth is the reform of administrative monopoly industries. By analyzing the reform process of telecom, we find the implementation of policy suggestions subject to the central government, who has tried to break administrative monopoly so as to improve production efficiency and allocation efficiency. The government is not a whole government--the department government often has a strong preference to administrative monopoly, and the central government is more representative as the interest of the public. On this basis, we gave systematic reform ideas of "two levels, four plus two"--under the assumption level of the government on behalf of public interest, the policy of market structure, the policy of regulation reform, the system reform of management in state-owned enterprise, the anti-monopoly law enforcement; under the assumption level of the government on behalf of themselves, perfecting the system of people's congresses to strengthen the supervision to central government, strengthening direct supervision of ordinary people.In addition, we also studied a key administrative monopoly industry, China telecom. That is the application and validation to the related theory and problem of main research part, and also can supply us with more perceptual cognition about the administrative monopoly. |
PDF Full Text Request