Research On The Causes And Countermeasures Of Overcapacity In China's Photovoltaic Industry

Overcapacity has become a difficult economic issue in China which hinders the optimization of industrial structure and its national economic development.The damage is clear because it will not only distort the price,decrease the market efficiency,but also it could lead to the mismatch of resources and the development of economics.Meanwhile,due to technical improvement and the progress of products' demands,the photovoltaic industry,for example,has become an important application in the global new energy industry.For its energy-saving and efficient characteristics,and since there are increasing number of investors focusing on it,the photovoltaic industry had got a substantial development.However,due to the financial crisis,PV industry of China has seemed to be that it's facing a overcapacity situation.Which,as a result,makes that analyzing the capacity utilization of photovoltaic industry and its inducement become an important theoretical research object.Around the degree of excess production capacity in photovoltaic industry in China,and its causes,the article argues a series of relative issues theoretically and practically.Based on the current development of photovoltaic industry in our country,combining the theory of market entry,the government intervention theory and the theory of entry barriers,the paper measures the PV industry overcapacity by utilizing detailed data from listed companies,within which the panel data offers methods to analyze cause and effect mechanisms of our PV industry.Conclusions in this paper lie to two aspects.On the one hand,there does exist overcapacity problems within the photovoltaic industry of our country,generally,the capacity utilization is low.On the other hand,through the empirical analysis,I found that both government subsidies and export have a significant impact on excess capacity rate.While government subsidies has a more positive significant to excess capacity,which means it would affect the intensity of capital to influence overcapacity.The export situation,however,has a positive impact on the changes of capacity utilization as long as the export quotaincreases,which as a result alleviate the excess capacity problem.Compared with existing research,the main innovation of this paper includes three aspects.Firstly,I take the photovoltaic industry as research object,which makes the issue more make sense.Because photovoltaic industry is a newly developed one that has more significance,but the overcapacity issue emerged in its early stage.This makes the industry become a super one to study the relations between the government and economics;Secondly,I measured the excess capacity combined with empirical test,it is a more rigorous analysis framework.Last but not at least,a comprehensive consideration of various factors have been considered empirically,which makes quantitative regression more detailed and accurate.Based on the measurement of the related data of listed companies,the paper puts forward that the corresponding countermeasures from three dimensions among the market,the government and the enterprises,this emphasizes that it should be more depending on the market to ease the overcapacity problems,and the government's industrial policy may merely lead to excessive interference problems,which even would become an excess intervention.