| The development of the automobile industry to a certain extent reflects a country's level of industrial development, and further, it is a country's leading industry and pillar industry in a certain time frame. However, in the process of economic globalization and situation of fierce international competition, Chinese automobile industry as a national leading and pillar industry,is facing more opportunities and challenges.Part1: The Document Review of Market Concentration Degree and Rate of Profit(A) Market power hypothesisThe basic conclusion of this hypothesis is that the concentration degree of any specific industry is related to the rate of profit of this industry, and the market concentration degree higher, the market dominance power of large enterprises is stronger, so the rate of profit in this industry is higher. There is economy of scale in this industry. High market concentration degree implies the existence of several large enterprises, which share a large number market. Those enterprises can reduce costs and improve profits by virtue of the scale. At the same time, large enterprises have the power to manipulate the market, so they make it easier to reach an agreement and reduce conspiracy costs, in order to gain monopoly profits through price advantage.(B)Efficiency structure hypothesisIn contrast with the hypothesis of market forces, efficiency structure hypothesis also called structural efficiency hypothesis, explains the positive correlation between the market structure and rate of profit from the efficiency aspect. Efficient enterprises with advanced production and management technology, compared with other small businesses, which provide the services at less cost and to gain higher profits. With a corresponding, they also occupy a larger share of the market, and will eventually make the market concentration degree increased.(C)Overview of relevant domestic research in recent yearsAt present, multicultural measurement analyses about the relations between various factors on the market structure and market performance, has been made a lot of achievements, in the cross-departmental study and the study of individual industries. Some scholars also analyzed the relationship of market concentration degree and market performance with inter-departmental model. However, due to the differences of the nature of industry and the development situation, Chinese automobile industry analysis must be very different from these cross-industry analyses. So, there is almost not Mathematical Analysis based on any measurable indicator of a specific industry.Part 2: Mathematical Analysis of Relationship of Market Concentration Degree and Rate of Profit(A)Review of the Chinese automobile industry development and the current situationThe development of Chinese automobile industry in general has gone through three phases: Start-up stage (1949 ~1965); The growth stage (1966 ~ 1980); The comprehensive development stage (1981~now). (B)Building and testing the modelThe possibility of the existence of a causal relationship between the market concentration degree CR3 and the rate of profit y is tested firstly by the software named Eviews, then we find that the possibility is higher than 80%. Thus, a one variable linear equation is established.a. The market concentration degree CR3 is assumed to the explanatory variable, and the y is assumed to the dependence variable in this overall model Through the study of the market performance varying correcting to the market structure varying, a simple one variable linear regression equation is established, which is based on the market concentration degree CR3 as to the explanatory variable and the rate of profit y as to the dependence variable. And then, the equation is analyzed by the method OLS and the software Eviews.As DW statistics can not be determined, there may be an effect that is CR3 affects itself. We eliminate this effect many times, but the two parameters also can not pass t-test. Therefore, market concentration situation of Chinese automobile industry on this stage does not significantly affect the rate of profit, or profit margins will not increase or decrease as the market concentration.b. The y is assumed to the dependence variable, and the market concentration degree CR3 is assumed to the explanatory variable in this overall modelA simple on variable linear regression equation is established, in which the rate of profit y is explanatory variable, and market concentration degree CR3 is explanatory variable. The regression equation is analyzed by the software Eviews and the method OLS, than we can get a preliminary regression equation. As there is an effect that is CR3 affects itself, we have to plus a lag effect of the market concentration to eliminate itself effect to get the model.Because the constant impact is not significantly enough, we have to remove the constant parameter in the original model. In addition, the parameter before y passes t-test and we accept the existence of this parameter. And once again the equation is adjusted, and we can get the final model.This indicates that the rate of profit of Chinese automobile industry this stage affects the market concentration conditions significantly, or they are proportional to another. They have a clear linear correlation, and almost have a direct proportion relationship, with no constant parameter.(C): Model test of the middle part market behaviorTo illustrate the degree of market concentration and profitability do exist causal relationship, and not because of the occasional contact caused by growth trend, we bring the intermediate links market conduction which is the middle part of the market SCP theory of industrial organization into the framework of the model. If the result is that the market performance precisely impacts the market conduction, and the market conduction further affects the market structure, it can be argued that the market performance determines the market structure. Enterprise R & D expenditures as a measure of the market indicator, we bring it into the model,and we can rule out this false illusion caused by the simple growth trend of the market structure and the market performance. Thus, a conclusion is got, which is that the rate of profit of Chinese automobile industry changes lead to concentration degree of market changes.(D) Model defectsa. It is not appropriate to complete on behalf of the market structure of Chinese automobile industry and the market performance with the market concentration degree and the rate of profit.b. The one explanatory variable simple linear model has great limitations. c. The sample data are too few.Part 3: Conclusion and Prediction of the Model From above linear regression analysis, we can see that there is significantly linear relationship between the market concentration degree of Chinese automobile industry and market profitability, or we can say the rate of profit impact market concentration degree significantly."high profit rate - high degree of market concentration" the reverse relationship of Chinese automobile market, which confirms to the development of the foreign industrial organization theory, some scholars'view, such as Stigler, is not only consistent with the view of the previous mentioned effective structure hypothesis, but also a little difference. Those efficient large enterprises in Chinese automobile market have advanced management technology and production techniques, so compared to other smaller companies owning little market share, they provide their service cost lower to gain higher profits. They taking up big market share increase the degree of market concentration of Chinese automobile industry.The competition in Chinese automobile market will increase in the next few years. As the automatic adjustment of the market and the optimization of government policies, Chinese automobile market will mature orderly towards oligopolistic markets, and guide and promote China rapid economic growth.Part 4: The Policy to Optimizing Chinese Automobile Industry OrganizationIn the world automobile industry developed countries, the situation of the automotive industry is high concentration and low profit rate, however the situation in China is very different from other developed countries. Chinese actual situation is the degree concentration is only about 40%, and profit rate is several times to the international level and even more than 10 times.From the above model analysis, we can see that the degree of market concentration of Chinese automobile industry is impacted by the former one degree of concentration and the profit rate at the same time, so improving Chinese current state of the automotive industry organization is necessary for Chinese government to pay high attention and concern at the same time from above two aspects: a. Relaxing control and enhancing competition in the market; b. Participating in the international division of labor to take the path of internationalization; c, Formulating policies to encourage merger and reorganization of enterprises; d. Breaking the entry restrictions and optimizing withdrawal mechanism; e. Encouraging and supporting our own brand development... |
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