China’s Mainstream Circulation Organization "Inefficiency Dilemma"Causes And Countermeasures

In the modern market economy, the circulation industry has become one of the most important industry with manufacturing industry in almost every country. Since China’s "Reform and Opening up" policy, its manufacturing industry has gradually developed into a handful of global manufacturing power and the "world manufacturing center" due to the "advantage of backwardness". But at the same time, the development of modern circulation industry was unfortunately left, and formed the dislocation structure of "leading manufacturing, lagging circulation". At present, the inefficient of China’s circulation industry are widely criticized, and the central government has issued several circulation industry development policies densely in recent years, which are enough to highlight the importance and urgency of this problem. A number of studies have indicated that the inefficiency of circulation will push up inflation, hinder the industrial upgrading, destroy the stability of macroeconomic and weaken the national competitive advantage.In fact, the inefficiency of China’s circulation industry, essentially due to the inefficiency of the mainstream circulation organization. For this inefficiency dilemma, this paper attempts to answer the following four key questions:(1) what is the nature of the circulation organization? What is the better theoretical perspective to analyze the inefficiency circulation organization problem?(2)what is the root cause of the inefficiency dilemma of China’s mainstream circulation organization?(3) what role can the "new" circulation organization(e-commerce and modern logistics distribution system), which is developing rapidly in recent years, play in the enhancement of inefficiency dilemma?(4) how to design and build a system of governance, to breakthrough the current inefficiency dilemma of China’s circulation organization?In chapter2, we review the relevant theoretical literature on China’s circulation efficiency and its research methods. Based on the established consensus about inefficient dilemma, this chapter compares6kinds of theory and methods, we think that the intermediary organization theory may be the best tool to analysis China’s circulation organization inefficiency problem. Under this theoretical perspective, the circulation organization is essentially a kind of intermediary organization which improving efficiency in the middle of the trade organization. Based on the intermediary organization theory, chapter3attempts to build the basic model of China’s mainstream circulation organization in combination with characteristics of China’s circulation industry, and finds that:the region segmentation and regional administrative barriers in circulation market, are the important reason of the inefficiency dilemma. As a result, the circulation organization has been locked in the primary state of "low, small, scattered", due to difficult to achieve cross-regional integration, coupled with the administrative monopoly pricing and the unnecessary administrative fees and fines in the process of circulation, especially for the wholesale and logistics industry, which jointly push up the circulation cost and also reduce the circulation efficiency. Further investigation also finds that, the deep-seated reasons for the inefficiency dilemma lie in the incomplete circulation system reform in the process of the economic system transition in China, the "championship" promotion mechanism of local government officials, and the "space exclusive" attribute in the regional economic development.Agricultural products market is one of the most typical circulation industry with relatively low efficiency, severe regional administrative barriers and market segmentation in China. Chapter4selects the agricultural products market as the sample by econometric analysis, and finds that:(1) since1996, the market segmentation degree of agricultural products circulation had not present a downward trend;(2) the local protectionism and regional administrative barriers are the important reason for rising agricultural products market segmentation, and the administrative fees represented by highway fees and fines further exacerbate the regional administrative barriers. This further demonstrates that, regional administrative barriers is the important cause of curing market segmentation and reducing the circulation organization efficiency.Chapter5further relaxes the theoretical assumptions of the basic model built in chapter3, and discusses the nature of the new circulation organization (e-commerce and modern logistics distribution system), the "inherent" attribute of cross-regional coordination of space on the new circulation organization, as well as how can the new circulation organization promote China’s circulation organization efficiency, and so on. This chapter argues that, the new circulation system can respectively promote the efficiency of China’s mainstream circulation organization and help break through the current inefficiency dilemma from two link booster of trade and distribution.Based on the conclusions, chapter6puts forward the following policy suggestions:(1) should attach greater importance to the healthy development of modern circulation industry, and accelerate the formulation and implementation of relevant plans and policies.(2) should build a cross-regional management coordination mechanism, strive to break the regional market segmentation and eliminate the regional administrative barriers, then improve the concentration of circulation industry.(3) should further deepen the reform of government administrative system, and gradually reduce unnecessary and unreasonable administrative fees, shrinkage administrative approval rights, and accelerate the plan that BT(business tax) reforms to VAT(value added tax).(4) give full play to the new circulation organization in playing the important role in reconstructing traditional circulation system, and accelerate the establishment of China’s modern circulation system.(5) strengthen commerce talent training work, stimulus and guide the colleges and universities to strengthen subject construction in the field of circulation.