| After 30 years'development since the policy of reform and opening-up, the steel industry of China has gotten the remarkable achievement. The output of crude steel in China has ranked first for 13 years till 2009, forming basically Bao Steel Group, Anshan and Benxi Steel Group, Hebei Steel and Shandong Steel. For a long time, steel industry in China exist numerous enterprises that scale are small, resulting in low market concentration, poor industrial performance, irrational industrial structure. Then how on earth is the present situation of the steel industry of China? This is the problem being analyzed in this paper. In order to come to the satisfactory and convincing conclusions, this paper intend to decompose gradually the steel industry by using the traditional paradigm of industrial economics, that is the Structure - Conduct - Performance (SCP) paradigm.Before using the SCP paradigm to make a systematic analyze for the industry, the thesis define steel industry at first. Then briefly describes the development of China's steel industry history, current situation and the supply and demand. Then, especially analyze the concentration ratio of steel industry, and clear the economic indicators which need to measure. After this, we establish the multiple linear regression model to identify the impact of market concentration. Besides, we analyze explicitly the market structure of the whole industry through combining with the product differentiation, scale economy, entry and exit, etc. Finally, we come to the conclusion that China steel industry is an industry which characterize as not high concentration, not obvious scale economy.The third part mainly study the price behaviors and non-price behaviors of the steel industry in China. Specifically, the non-price behaviors include merging and reorganization, R&D, and study the effects on performance of mergers by using event study method. Ultimately, we determine the feedback effects of market behavior through an econometric model which include the above-mentioned variables, and accordingly identify the degree of market power.As for the performance, firstly adopt the basic statistical methods to study the Return on Total Assets Ratio, PCM, based on which we observe the causal relationship between PCM, market power and elasticity of demand. The results show that the greater market power and concentration, the higher PCM of steel industry, the better industrial performance, nevertheless, the more sensitive demand elasticity, the lower PCM in this industry. In addition, we also analyze the advancement of technology and the quality of product, as a result, we know that the current standard of technology in China steel industry play a vital role in leading to low quality of products. Given the situation, it is high time that we should enhance the standard of it. Only in this way can China become a. In the final analysis, by comparing the performance of Listed Companies, we learn that the business conditions of companies in this industry could not be optimistic in recent years, which undoubtedly reflect the severe situation facing the whole industry.Given the above-mentioned problems, in order to optimize the market structure and business behaviors, we address corresponding suggestions for the steel industry from micro-level and macro-level, therefore, the performance of the whole industry being improved. |
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