Market Concentration,ownership Structure And Capacity Utilization Of Manufacturing

Excess capacity is one of the economic problems that China faces for a long time.Low capacity utilization led to a serious waste of resources,and hinder industrial restructuring and upgrading.There are many reasons for overcapacity.The sharp fluctuations in demand,the government’s improper intervention,market failure may lead to the phenomenon of excess capacity.Study the mechanism of excess capacity can better resolve excess capacity.Marketization is the main direction of China’s economic system reform,and it is of great significance to study the influence of market factors on the mechanism of overcapacity.Most of the papers have studied excess capacity from the perspective of market failure and local government intervention in the market.However,The change of the market structure of our country is caused by the change of property right structure.Therefore,it is necessary to study the relationship among market structure,ownership structure and excess capacity.This paper focuses on the relationship between market concentration,ownership structure and excess capacity.First of all,through the study of the literature,summed up the main factors leading to overcapacity phenomenon.Secondly,on the basis of the existing research,through the theoretical analysis,the transmission mechanism between market concentration,ownership structure and capacity utilization is defined.Finally,using the calculation method of the existing capacity utilization rate,we calculate the capacity utilization of manufacturing industry in 2001-2014.The empirical analysis of 27 industries is made by using the data of capacity utilization.It is found that the proportion of state-owned property rights and capacity utilization is negatively correlated.High proportion of state-owned property rights is the main reason for excess capacity;the market concentration is negatively correlated with capacity utilization,indicating that the increase of market concentration has no effect on technological innovation;the combination of market concentration and the proportion of state-owned property rights in the short term is conducive to the improvement of capacity utilization.But this is at the expense of innovation stagnation and market inefficiency.Innovation stagnation and market inefficiencies in the long term will lead to serious overcapacity.Therefore,it is not recommended to enhance the utilization ratio of the market by increasing the concentration of the market or the proportion of state-owned property rights.