Study On The Influence Of China 's Coal Industry' S Entry Barrier On Market Performance

In industrial organization theory,barriers to entry is a key factor of the market structure of industry barriers to entry will change by changing the industry’s market structure, which in turn affect the market behavior to affect the market performance. For some industries which have unreasonable market structure and low market performance, we can get good effect by changing entry barriers.China is the world’s largest producer of coal, coal is China’s most important energy, coal industry is related to the development of national economy. China’s coal industry for a long time has the problem of low entry barriers, and thus triggered a series of problems such as excessive competition, overcapacity, severely reduces the market performance of the coal industry, which not only hinder the healthy development of coal industry, but also affected the pace of China’s industrial transformation and upgrading. So this paper mainly studies the entry barriers of the coal industry in the performance of the market, the research content is as follows.This paper first clear definition of barriers to entry basic on the past research and finishing, barriers to entry is defined as incumbent firms relative to potential into the enterprise competitive advantage, from the source of barriers to entry will be divided into structural barriers to entry, administrative barriers to entry and three types of behavioral barriers to entry. Structural barriers to entry is constituted of economies of scale, absolute cost advantages and product difference. Administrative barriers to entry is constituted of administrative policy, and behaviora barriers to entry is constitued ofl enterprise behavior. Then, this paper explore the path entry barriers affect the market performance, found that all kinds of barriers to entry to the market performance dual role, details should be combined with the industry the truth. On the basis of the theory in this paper, combined with the truth, we found that the coal industry’s entry barriers is mainly constituted of the economies of scale, absolute cost advantages, administrative policy and corporate behavior. And the empirical analysis with panel data to measure the difficulty degree of coal industry barriers to entry and compared with other industries, come to the conclusion that the coal industry has low barriers to entry. Later in this article, through the empirical test of the coal industry barriers to entry’s effect in the performance of the market, concluded that in the long term, economies of scale for the coal industry market performance had significantly negative influence, absolute cost advantages and behavioral barriers to entry had significant positive influenceto the market performance, administrative barriers to entry has no significant effect on market performance. In the short term, economies of scale and absolute cost advantage has the same effect in the market performance and with the long term, and behavioral barriers to entry and administrative barriers to entry were not significant effect on market performance. Finally, this paper analyzed the feasibility and urgency of improving the market performance of the coal industry, and based on the research conclusion, this paper put forward policy suggestions to improve the market performance for the coal industry.