China Takes An Exam The Training Industry Development Pattern And The Government Intervenes A Research

In the twenty-one century, with the deepening of globalization, China has walked into a knowledge-based economy period and the society has a high demand for talents. To meet the social need of the economic development, people swarm into taking part in all kinds of examinations to reach certain education level or gain certain certificates. These certificates are regarded as proof of knowledge level and capability, and therefore a kind of social recognitions. While people are passionate in taking exams, test-training naturally become a must step or the key to occupations in society. Although people vary in comprehensive quality, they commonly regard test-training as shortcut to quality enhancement and career development after considering rationally the opportunity cost and the risks. Since the 1980s of 20^th century, due to the high market profit, training organizations developed all kinds of test-training services and increase the business promptly. They posses different market share by providing training at various level or stage and form a "test-training service chain" with certain industrial scale. This makes test-training service gradually develop into a complete industry of economics. Test-training industry, then as a complete industry, formed. This industry is not at all contradicted with training industry since it is still a branch of training industry.Today, we give lots of description about the phenomena of the test-training industry. But specific industry boundary and sufficient attention were not given to this new industry. These lead to structural unbalance of the market, which appears in the market through training organization cheat students by the illusive advertisements and have high income but escape from tax etc. The author believes that we should survey these phenomena and analyze these problems in a higher theoretically level. Only by this way can we find the root causes and draft effective action plan. To make up the blankness and arose the social concern, the essay would bring forward the new conception of test- training industry and analyze it completely with industry organization theory. The essay also takes the New- Orient School as an example to reveal the developing direction of Chinese training industry and put forward the policies and suggestions to the current problems from the view of macrocosmic and microcosmic aspects.The test-training industry, as far as its name is concerned, is the industry providing training courses for examination. This kind of training has come into an industry in that it possessed the basic features of an industry such market demand, occupation fund, professional products, product quality, cost calculation, social economic effectiveness and so forth. In the "exam rush" phenomenon lie the objectiveness and necessity of the industry occurrence and development. First, selection mechanism exists in both education and occupation where the test is the main method; second, the investment from the state, enterprise and the individual human resources is increasingly enlarges; salaries are determined by knowledge and techniques; the society are prone to over consume talent. All the factors contribute to the immense the training market demand, both in reality and the potential. The test-training industry is therefore developing into a large scale.We can draw some conclusions as follows from the analysis on the three key performance indicators including market structure, market behavior, and operation results:1. he market structure of test-training industry appears to be: greatly concerned and diverse in products; having less barriers when entering and quitting the market; competition exist together with monopoly; monopoly take place naturally in the circumstances of excessive competition; the vertical unification is far from satisfactory and scale economy is at its early stage.2. He market performance of training organizations, except for the normal education, appears to be: bearing with low cost, having uneven teaching quality, making false advertisements to produce "fame effect and practicing serious tax evasion.3. The operation results of test-training industry, however, turn to be profitable and beneficial compare to average market profit rate.The test-training industry has both positive and negative exterior effects. With the development of "exam economy", it brings "new economy increase" to other relevant industries such as publishing, web application, software development, transportation and restaurant. At the same time, it affects the normal didactical order in different type of schools. Teachers tend to guess or speculate examination questions rather than help students grasp the knowledge comprehensively. The examination results become a parameter to evaluate teachers. And training fee increases greatly and gives pressure on the family and the society.We take New-Oriental School as a case study. It provides beneficial experience on the development of this industry. In the excess competition training market, it still sets a good example and indicates a developing direction of this industry. Some hints could be summarized from this New-Oriental development model to assist in guiding the healthy development of other training organizations. Generally, training organizations should possess the basic individual discipline. They should not ignore the market obligation and long-term interest, and enter and exit the market randomly or escape taxes. The training organization should seek for specialization and form the advantages on teacher and information resources of its own. Advantages on management and brand should also be developed in order to enhance its competition ability. Realize scale economy by stabling a standard operating model of chain management, unification and criterion under the centralization of state power, the division of work and subdivision, and reducing the cost. Based on the actual situation, choose the management model between specialization and incorporation and get close to industrial incorporation.Chinese now is in the period of economy transformation and system reformation. The development of the test-training industry must depend on the microscopically control of industry organization policy, and reformation of national economic system under the market mechanism, in order to form the industry organization itself. The model of the industry organization policy must focus the balance and efficiency and eliminate the administration's monopoly. The core of policy is to form a reasonable industrial scale. This means we should seek for enhance the quality of training services and management efficiency, and realize industrial scale economy rather than simply restrain the excessive competition. The government should regulate the training industry by establishing regulations and guidelines on protecting intellectual property right and consumer's right, strengthening counter-cheat and counter monopoly, and restricting the behavior of training organizations.We believe that revenue policy is effective to cure and overcome the exterior negative effect caused by test-training market. Following revenue system reformation should be emphasized: strengthen the revenue legal system; inspire training organizations pay taxes initiatively; take advantage of exterior information to supervise the revenue levying .At the same time, we should reform the exam system by enhancing the quality of examination and perfect the national education and the selection of professions. In addition, the establishment of credit system will reduce the cost of the training industry and the whole society greatly.There are totally 9 chapters in this paper. The central topic is "the development of test-training industry and governmental regulation". The contents are divided into 5 sections:Section 1 (chapter 1 and 2): Introduction and references overviewSection 2(chapter 3 and 4) Attribute, structure and efficiency evaluation of test-training industrySection 3(chapter 5 and 6) Exterior effect and international comparisonSection 4(chapter 7 and 8) Appropriate rules and policy analysisSection 5(chapter 9): ConclusionThe innovation in this paper lies in 1) putting forward the concept of the training-industry, and definitude the industry connotation and extension; 2) setting up a price modeling; 3) claiming that property right restriction could be a solution to inappropriate test-training industry organization; 3) emphasizing appropriate governmental interference such as legal system; 4) emphasizing the importance to establish a revenue supervision and credit system.