Monopoly And Industry Income Distribution Gap,Discussion On The Reasonableness Of Monopoly Industries’ High Income

With the reform and opening’s development and the rapid growth of the domestic economy, people’s income level is increasing year by year; at the same time, the income gap has expanded, especially the gap among different industries. Whether the income gap are controlled properly or not is related to the construction of harmonious society a, the realization of well-off society and the stabilization of the society. Therefore, obviously, it has attracted the attentions from all kinds of people.Many factors influence industry income gap, not only rational factors, but also irrational ones. For example, labor productivity, per capita profit rate and the level of human capital are reasonable factors, but administrative monopoly and market access barrier are relatively unreasonable. In contrast with non-monopolistic industries, the staff members of monopoly industries acquire a considerable level of income, including wages and invisible welfare. Whether it is due to the light of inefficiency draws a great deal of people’s attention. However, most of the current literatures are lack of quantitative description. Also, it is acknowledged that unjustified income allocates mechanism makes the polarization worse, affects the social stability, and hurts the social equality. So, the essay concentrating on the present situation, predominant influence and the rationality of monopoly industries’high income are partly significant to the theoretical research and practical applications.Based on the "theoretical foundation-empirical analysis-suggestion" framework, the essay is divided into five parts. The first part is introduction, which mainly introduces the background and the significance of choosing the topic, interrelated review of foreign and national literatures, train of thought and the innovation of the research. The second major part is a quantitative description of current state of residents’industry wage gap, and it describes invisible income taking advantage of per capita management costs and the radio of administrative expenses to revenue. Then, based on the industry characteristics, the third part measures the contribution of every industry characteristic to industry income gap employing Ranis-Fei decomposition method. The empirical research shows that, the income gap can be explained more than3/4proportion by industry monopoly, the radio of foreign direct investment, the radio of cost to margins and per capita industry profit. In the chapter four, we give a discussion on the reasonableness of monopoly industries’high income from three perspectives, such as wage inspiriting system, productivity effect and labor assessment. From above research, we can draw a conclusion that the high income is inequitable. The last part of the essay is conclusion and suggestion. The government should introduce competition mechanism to break monopoly, establish a unified and standardized labor market to eliminate discrimination, increase adjustment power of income distribution to narrowing income gap.