| In 2006, China abolished the restrictions on construction market to fulfill the commitment promised before joining the World Trade Organization, making international and domestic construction market closely linked, which gives the domestic construction enterprises a chance to gain a greater potential market and the opportunity to compete with international contractors on the same stage. They are both opportunities and challenges for domestic construction enterprises. However, there are still many problems in the Chinese construction industry by comparison with foreign countries, outstandingly represented as the inefficiency of scale, low industry concentration, which directly affects the rational allocation of resources within the industry and limits the improvement of market performance. Under the circumstances, the Chinese construction enterprises want to compete with foreign ones, have to increase their own competitiveness. Therefore, at the stage of Economic Transition, it's urgent for Chinese construction industry to find practical reform measures to further optimize industry and market structure of the construction industry, improve industry performance standards and then enhance the overall competitiveness of the industry.In industrial organization theory, the relationship between market structure and the market performance has been the focus of attention. The industry concentration is the main indicator to measure market structure, which affects market performance through market behavior. Therefore, this article will study construction industry from the perspective of the relationship between industry concentration and market performance, analyze the status of Chinese construction industry's market concentration and performance and discuss the relationship between them, empirical study the influential factors on market performance, and then give some suggestions.Firstly, the article analyzes the meaning of the industry concentration and market performance, and then reviews the relationship of them in theory, which lays a theoretical foundation for the following paper to analyze the relationship of them. Secondly, by calculating CRn, profit ratio of output value and other related indicators, by analyzing quantitatively the current situation of industry concentration and market performance, the article draws the conclusion that both industry concentration and market performance of Chinese construction industry are low. On this basis, the paper speculates that the low market performance may have internal relations with the low industry concentration to a certain degree. In order to further explore the relations of them, the paper defines the representative indicator of market performance-profit ratio of output value as the dependent variable and the related influential factors as qualitative variable, builds regression model, makes sure there are linear relations between them by quantitative analysis and then analyzes how influential factors'indicators of concentration impact on market performance. Finally, according to the results of regression analysis, the paper aims to raise suggestions in optimizing industry concentration to increase market performance of construction industry with pertinent merger and reorganization, entry barriers, industrial policy and other ways. |
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