Research on Administrative Monopoly Issues in China

Author: Yang Lanpin
Publisher:
Publish Date: 2006-09-01
Features: During the establishment and improvement of China's market economy system, administrative monopoly has attracted widespread attention and strong dissatisfaction from all sectors of society due to its complexity and significant harmfulness. Issues such as industry monopoly, local protectionism, and government restrictions on trade activities not only hinder the functioning of market mechanisms and infringe on the rights and interests of market entities but also foster corruption and obstruct the progress of economic reforms. Research on administrative monopoly in China's academic circles primarily focuses on its forms, causes, consequences, and measures to combat it. While there are reasonable insights and enlightening theoretical perspectives, severe disagreements exist across nearly all aspects of the issue. Moreover, there are many shortcomings in the understanding of administrative monopoly. Clarifying these misunderstandings, conducting comprehensive and in-depth research on administrative monopoly and its evolutionary patterns, and eliminating its negative impacts are pressing issues. This book provides a thorough and comprehensive analysis and discussion of China's administrative monopoly problem, proposing a series of principles and specific measures to address it.
Chapters 1 and 2 introduce the relevant theories of administrative monopoly and the current state of research on the issue within China's academic circles. The author argues that theories such as classical economics, public choice theory, and new institutional economics are of significant guidance and reference value for studying China's administrative monopoly. Although China's academic circles have made great progress in researching administrative monopoly, there are still many shortcomings. The author defines "administrative monopoly as the prohibition, restriction, obstruction, and exclusion of market competition by state institutions using public power," and notes that not all forms of administrative monopoly are illegal or unreasonable. Some forms of administrative monopoly have necessary and reasonable justifications. State monopoly is one form of administrative monopoly. Administrative monopoly is related to but distinct from state monopoly, economic monopoly, and natural monopoly.
Chapters 3, 4, and 5 conduct a historical examination of China's administrative monopoly problem. The author analyzes the forms, characteristics, and consequences of administrative monopoly in different historical periods, such as ancient China, modern China, the planned economy period, and the period of systemic transformation. The author argues that administrative monopoly is both universal and specific. As a form of state control and intervention in the market, administrative monopoly has existed in every historical period of Chinese society. However, due to changes in social, political, economic, and cultural conditions, its forms and characteristics have varied greatly across different historical periods. Administrative monopoly during China's transitional period exhibits particular complexity and uniqueness in its forms, causes, and economic consequences, which are determined by factors such as the political and economic system, socio-economic development conditions, legal system, and ideological concepts during this period.
Chapters 6 and 7 analyze foreign administrative monopoly issues and the impact of WTO rules on China's administrative monopoly. The author points out that the notion that developed countries do not have administrative monopoly is unrealistic. As a form of government intervention in the economy, administrative monopoly also exists in developed countries. The difference lies in that administrative monopoly in developed countries is a means for the government to address market failures under a mature market economy system and a sound legal framework. Other countries undergoing systemic transformation also face administrative monopoly issues similar to China, indicating that administrative monopoly has a direct correlation with political and economic systems. Addressing administrative monopoly requires more than just legal measures; it necessitates changing the systemic foundation on which administrative monopoly relies. Administrative monopoly in East Asian countries demonstrates that it is also related to economic development conditions and cultural traditions. WTO rules play a positive role in regulating government behavior and mitigating the negative impacts of administrative monopoly. China should strictly adhere to WTO rules while actively participating in international competition and adopting a moderately protective policy for its national economy.
Chapter 8 discusses the goals, principles, and measures of combating administrative monopoly during China's transitional period. The goal of combating administrative monopoly is to establish a unified, open domestic market and a fair competitive market order, as well as a limited, efficient, and service-oriented government. Combating administrative monopoly should adhere to principles such as differentiated treatment, economic efficiency, and fair competition. The author proposes that combating administrative monopoly does not mean a complete prohibition or elimination of it but rather adopting different attitudes and measures for different forms and types of administrative monopoly. For state monopoly, a strategy of permitting, restricting, and reforming should be adopted; for natural monopoly industries, strategies such as limiting monopoly scope, separating government from enterprises, and relaxing entry regulations should be implemented; for local protectionism, legal measures should be combined with deepening reforms to eliminate it; and for state-owned enterprises in competitive sectors, monopoly behaviors should be prohibited while deepening reforms.