Research On Government Intervention To The Development Process Of Baosteel

To maintain the macroeconomic stability is one of the most important contents of the government’s economic functions. A stable Macroeconomic is a common requirement of all the main market activity; Practice shows that, the self- organization mechanism of the market cannot remove the cyclical fluctuations of economy; the only way to ease fluctuations is relying on the government’s macro-control.During the early stage of reform and opening-up, domestic industries start a new path of development, the steel material as an important strategic material of the country, has become particularly rare; the Baosteel Group which is known as product of China’s reform and opening-up, lay the first pile at the banks of the Yangtze River, Baoshan District, Shanghai, China on December 23 th, 1978, the second day of closing the third plenary session of the eleventh. With the rapid growth of China’s economy scale, China’s iron and steel enterprises also developed in a rapid speed, both in steel mills’ number and capacity. Steel productions gradually become overcapacity instead of rare.Since 1996, the state has begun using the macro-control policy to limit the blind explanation of the steel industry. But the effect of the policy is not obvious, the main reason is the will of the enterprise scale market conditions did not form, does not match with rapid development in all regions. On the one hand, by the rapid development of the national economy and large-scale investment, steel demand grow rapidly, and this cause the rapid growth of the steel capacity; on the other hand, steel companies, even on the conditions low-profit, still urge to increase production capacity, for some reasons the local government also to promote the expansion of steel production capacity. Recently, The State Council has issued guidance on the development of the iron and steel industry’s the further planning.From the beginning of reform and opening-up to the present, the government’s intervention has never stopped.This thesis mainly from the perspective of the market and institutional starting to national investment large steel companies as a starting point, reviewed and summarized the impact of government intervention in the steel industry during recent years, including the theory of government intervention, the influence of government intervention in the iron and steel corporation ‘s operations and performance; elaborated that steel companies along with the country’s economic development and growth, analyzed the state’s strategy of development of iron and steel enterprises, investigated the effects and mechanism of administrative system of iron and steel enterprise strategy and behavior. This thesis, through analyzed quantities of data, contrasted the policy and files, qualitatively and quantitatively analyzed the timing of government intervention, tools, effects the relationship and interaction between market, enterprise and government intervention which focus on Baosteel.