The Study Of The Price Regulation Model Of Natural Monopoly Industry

The price regulation issue of the government is always an important emphasis in economics research field, and the research on the price regulation of traditional monopoly industry has become the hotpot in the field of theory. Whether need regulation? How to regulate? It is two main problems to the government. With the development of economic, it is necessary to study in this thesis. The telecommunication industry being natural monopoly industry is a backboneless industry in the country. The government pays more attention to the telecommunication industry in the eleventh five-year plan. If we want to develop the telecommunication industry, it is not only need the police support, but also need to apply the reasonable methods to regulate the telecommunication industry.So this thesis studies the theory of price regulation of the government. Base on improving the behalf of the society and economic efficiency, this paper divide the natural monopoly into strong monopoly and weak monopoly. And the price decided the average cost is the better way.I induct an important financial index WACC firstly using for reference idea of EVA which used in value estimation, and also put forward the importance of price regulation model. And I define the parameters and index. It can improve the practical of model.In demonstration, this thesis studies the price regulation methods and process of Local telephone service in different countries and different phase. Also analyses the current situation and questions of Local telephone service in China. At last puts forward the aim of regulation. This thesis improves the price regulation model, uses this model to study the Local telephone service of China Telecom, finally draw a conclusion about the price of the local service. So this thesis provides a new theory support for the development of price regulation in the telecommunication industry.