Market Segmentation And Inter-provincial Resource Misallocation

Resource allocation is a core issue in economics research.In theory,if the resource allocation is effective,the marginal remuneration of resources between different economic individuals and different departments is equal.However,in reality,there are some artificial institutional obstacles,such as local protection and market segmentation,enterprise ownership structure,enterprise entry barriers,financing constraints,labor mobility restrictions,etc.,so that resources cannot be effectively allocated.Under China's current economic system,a common problem is that local governments,in order to complete local assessment targets,protect local products or factor markets through direct or indirect means,which hinders cross-regional flows of resources and market segmentation.This will result in a certain degree of inter-provincial resource mismatch.However,there are few studies on market segmentation and inter-provincial resource mismatch at home and abroad,and theoretical and empirical studies are not sufficient.The mechanism of influence and the path of action did not give a reasonable explanation.Therefore,it is of theoretical and practical significance to study how market segmentation affects cross-province mismatches.This paper takes China's various provinces as the research object,and explores the trend of resource mismatch between China's manufacturing industries and the role of market segmentation.The data covers the relevant indicators of 28 provinces in China from 1999 to 2013.On the theoretical model,this paper derives the formula for calculating the mismatch of the overall economic level based on the predecessors,and then decomposes the formula,and finally obtains the mismatch between the provinces and other regions.The formula is a measure used to measure the mismatch between resources in China's provinces,and uses the "price method" to measure the degree of market segmentation.Subsequently,based on the above theoretical model,the article measures and analyzes the inter-provincial mismatch and market segmentation degree of Chinese manufacturing industry.On this basis,this paper studies how market segmentation affects inter-provincial mismatch and builds market segmentation.For the core explanatory variables and inter-provincial resource mismatches as the explanatory models of the explanatory variables,the instrumental variable method is used for estimation.The regression results show that the market segmentation can aggravate the inter-provincial mismatch to a certain extent,and the correlation test also proves the regression results.Robustness.Subsequently,this paper explores the role of market segmentation for cross-province mismatches.The results show that local government protection of state-owned enterprises is the main way for market segmentation to aggravate inter-provincial resource mismatch.Therefore,breaking the market barriers at the regional level makes it more necessary to rely on the market for the price of products and factors to build a more accurate and reasonable price system.