Market competition, economic performance and industry concentration

Author: Wei Hukai
Publisher:
Publish Date: 2003-03-01
Features: Industrial concentration is one of the core issues in the study of industrial economics. This book revolves around the main theme of market competition, economic performance, and industrial concentration. Using systematic data from nearly 600,000 enterprises and 521 four-digit small industries collected during the Third National Industrial Census in 1995, it provides an in-depth examination of the concentration status, changing trends, market structure characteristics, and underlying causes of China's manufacturing industry since the reform and opening-up. It explores the relationship between industrial concentration, innovation, efficiency, and profit rates, and subsequently proposes corresponding policy recommendations. The fundamental idea of this book is that industrial concentration is the result of market competition and government intervention. Since market competition follows the principles of "survival of the fittest" and economic efficiency, under the spontaneous influence of pure market forces, competitive and highly efficient enterprises will rapidly expand, increase their market share, and thereby promote the level of concentration. Conversely, the continuous rise in concentration will also affect market competitiveness and influence corporate behavior and performance. For government departments, the primary goal of industrial organization policy lies in encouraging effective competition. This gives rise to two distinct policy orientations: combating excessive competition and anti-monopoly measures.