The Analysis Of The Income Of Natural Monopoly Industry From The View Of Institution

Income distribution is a sensitive topic of conversation which relates to everyone's immediate or vital interests. Since opening up and reform, China's economy has maintained a general trend of rapid development, the income of residents has been steadily increasing, people's living standards have been improved, but meanwhile, the resident's income gap has become greater and greater, especially the abnormally high income of natural monopoly industry has made people produce the big and powerful imbalance in the heart. It has given a tremendous impact on the efficiency and justice of the society we live in, and it has threatened the construction of harmonious society directly.Firstly, this paper clarifies natural monopoly theory and the characteristics of natural monopoly industry. The natural monopoly has traditionally been attributed to the economy of scale, but recently it is attributed to the cost subadditivity by some economists. The attribute of natural monopoly cannot be irrevocable. With the development of technology and the change of demand, the attribute of natural monopoly industry is also changing unceasingly. The analysis of natural monopoly theory is in favor of learning about the natural monopoly industry. And as a concrete industry, natural monopoly industry has a series of special economic and technical characteristics: economies of network, economies of scale, economies of scope, economies of sequence, capital precipitability as well as universal service.Secondly, the paper analyzes the current situation of income of China's natural monopoly industry. Based on analysis of the income of natural monopoly industry, the paper puts forward the characteristics of income of natural monopoly industry, namely high income, high growth and high welfare.Thirdly, the paper analyzes the reason why the income of natural monopoly industry is too high from the view of economy and institution. Superficially, the special monopoly status of natural monopoly industry and the present income distribution system causes a large amount of monopoly profit which the natural monopoly industry can obtain to be preserved excessively, thus it provides sufficient capital source for the abnormally high income of natural monopoly industry. Fundamentally speaking, the abnormally high income of natural monopoly industry in China results institutional from administrative monopoly.Finally, the paper infers some policy suggestions for adjusting the abnormally high income of natural monopoly industry. The paper analyzes the traditional income distribution system used to govern natural monopoly industry and explains that it is not effective enough. Based on this, the paper infers reform models for income distribution system. This paper further analyzes that the root cause for the abnormally high income of natural monopoly industry is administrative monopoly and the basic reason for the existence of administrative monopoly is the regulation system of the government and business gathering highly. Therefore, in order to solve the income problem of natural monopoly industry fundamentally, China must deepen the administrative monopoly reform in natural monopoly industry and thus break administrative monopoly structure from system radically. In line with the successful experience of foreign administrative monopoly reform and the actual situation of China's. natural monopoly industry, China's administrative monopoly reform in natural monopoly industry should separate the functions of government from those of the enterprise, establish the independent supervision framework, speed up the property right reform, reorganize the market structure and perfect law system.