Countermeasure Research On Local Government’s Macro-Cotrol Of The Coal Market Failure

The coal industry, as a major foundation energy of China’s industrialization process, is a pillar industry of the national economy which has an important strategic position and play a significant role for the rapid development of China’s economy. However, since 2008 international financial crisis, the coal industry also appears multiple crises such as the imbalance between coal supply and demand, the structural overcapacity, oversupply and the impact of coal imports etc., which become increasingly prominent issue at present. In recent years, the government has never ceasing to introduce various policies in order to restrain overcapacity, the local government has also adopted a series of emergency relief measures to alleviate the local economic recession caused by coal industry crisis, but this issue is still not effectively addressed. Coal market, as an "invisible hand" in the market economy system, usually failed to regulate its own defects effectively by itself to solve the market failure problems, while the local government, as a "visible hand" in the social and economic development, owning to its inherent nature, decision failure and other non-market factors, contain the market regulation and failed to play a complementary role to market mechanism, which leads to intervention failure of the coal market.Based on the theory of government intervention theory, government economics over market failure, competing theories and excessive entry, this paper studies the problems caused by coal market failure at the present status from the perspective of macro-control by local government. Through analyzing the market failure and the local government’s macro-control status, this paper study on micro-control failure by local government through the following aspects:officials interests, government functions and policy making problems, the game between central regulation and local government’s behavior and other issues. In the end, this paper shows three specific measures to relieve the problems of coal market failure:improving the reformation of financial and official’s promotion system; strengthening central government regulation and clarifying the role of local government. In this way, it makes references to relax the current slumping coal market problems so as to promote a better and faster development of coal industry and the national economy.