Studies On The Economic Analysis And Suggestions On The Developing Of Poplar Processing Industry Of Northern Jiangsu

The northern area of Jiangsu Province, which consists of five cities as Xuzhou,Lianyungang,Suqian,Huai'an and Yancheng, is a fluvial plain on the catchment area of the Huaihe river and disused riverway of the Yellow river. It is the southern part of The North China Plain and at the same time locates in The Yellow-Huaihe-Haihe Rivers Plain region. The industrial basis is comparatively weak in this area and the economy development is still behind other areas in Jiangsu. Since the successful introduction of south-type poplar in Jiangsu in 1970s, poplar has become the mainly cultivated tree species in The Yellow-Huaihe-Haihe Rivers Plain and spreads widely. Since the 1980s, the northen Jiangsu area has formed a poplar breeding system consists of centralized poplar forest, farmland poplar net and surrounding poplar-planting district.Especially during the period of the tenth five-year plan, the successful cultivating and popularizing of the new generation poplar has drastically improved the forestlacking status in northen Jiangsu, thus obviously improved the economic, social and ecological environment of this area. The breeding of poplars has also brought to life the polar processing industry, which is becoming the leading industry for northen Jiangsu people to get rid of provety and enhance their living standard. At present, there are over 6000 woodprocessing enterprises in northern Jiangsu, providing job opportunities for over 300,000 people and creating enormous boosting social and economic interests. The poplar industry has become the leading force and new economic growth factor in The Yellow-Huaihe-Haihe Rivers Plain region.Alough the poplar processing industry has taken initial shape, there are still a number of problems remained, restricting the utilization of the poplars and the development of the industry. This article systematically introduces the status of the development of poplar industry in Jiangsu province in an all-round way on the basis of a systenmatical expatiation of the theories the study based on: Industrial Economics Theory, Industrial Organization Theory, Institutional Economics Theory, Produce Theory, Theory of Proper Scale For Experimental Production, and the domestic and overseas research achievements on poplar industry, and put forward the existing problem according to the present situation of the cultivating and utilization of poplar and the problems which have already been recognized. Then, the article analyzed the market structure of the poplar processing industry in northern Jiangsu as well as the market behavior of the enterprises and consequent market performance by using Bain's SCP paradigm from the respect of Industrial Organization, putting forward the proper scale for the development of enterprisesin this area and finally, gives systematic suggestions to the government and enterprises. The article studys and analyzes the market structure of the poplar processing industry in northern Jiangsu from the respects of the concentrate ratio, differences between products and the barriers to entry and exit.The indexes of CR₄,CR₈ were worked out as well as the Lorenz Curve simulating the structure of distribution of the poplar processing enterprises in north Jiangsu and the Gini Coefficient.The comprehensive calculation of several indexes showes that the market structure of poplar processing industry in northern Jiangsu is close to perfect competition, a market populatd by firms that are small relative to the market, each producing identical product with no monopoly power existing and low barrier to entry and exit. Such kind of market structure decides the market behavior of the enterprises and the whole market performance of the poplar processing industry in northern Jiangsu.Consequently, the article researched and analyzed the market behavior of the poplar processing enterprises in north Jiangsu. The article believes that affected by the market structure, the market behavior of the poplar processing enterprises in north Jiangsu are mostly competitive, and particularly in price competition. At the same time, non-price competition is also increasingly adopted by some large-scale enterprises. Besides competitive market behavior, market coordinating behavior also exists.The market coordinating behavior of the poplar processing enterprises in north Jiangsu presently mainly lies in the mergers and acquisitions among enterprises, exerting an substantial influence on the market structure and performance.On the basis of studying and analyzing the market structure and behavior of the poplar processing insudtry in north Jiangsu, the article addressed the market performance of the poplar processing industry in north Jiangsu.The article points out that although the market structure of the poplar processing insudtry in north Jiangsu is similar to perfect competition. Perfect competition is a situation in which no producer surplus and no monopoly exists and prodcers cannot affect price of the products so that the resource distribution efficiency is comparatively high. However, as the scales of the producers are too small, the whole market supply is offered by enterprises smaller than the minimum efficient scale, there is a severe waste in resource and the production effectiency is comparatively low, causing poor product quality, stagnancy in technology progress and product resemblance. Therefore totally speaking the market performance of the poplar processing insudtry in north Jiangsu is to be improved. Through the market harmonizing behavior of the poplar processing ecterprises in north Jiangsu, such as merger and acquisition, work division and cooperation, yet, the comparative productivity effect is on the increase.From the study of SCP paradigm we can see that the scale of the enterprises is a crucial issue in the development of poplar processing industry in northern Jiangsu. Thus the article addressed the proper scale of the poplar processing enterprises in northern Jiangsu from the respects of scalar-economics models and other affecting factors. Due to the characteristics of the production process of wood-processing industry, the poplar processing enterprises in northern Jiangsu need a large amount of investment in equipments. And considering the equipment investment only, the bigger the scale, the better it is. So the smallest effective scales of the enterprises are all comparatively large if the initial investment is big enough. Restricted by the characteristics of poplar distribution in northern Jiangsu and the supply of labour, however, the scale of the poplar processing enterprises in northern Jiangsu should not be to large. Taking various affecting factors and the market environment and condition of the poplar processing industry in northern Jiangsu into consideration, the minimum efficient scale for the poplar processing enterprises in northern Jiangsu should be around 30,000-50,000 m³ annually.At last, on the basis of Industrial Organizational Analysis and proper scale judgement, the article put forward suggestions and solutions respectively from the aspects of government policy and enterprises stretagy. The government should implement favorable external policies and create a sound market environment for the development of the poplar processing industry from the following aspects: poplar cultivating, policy forstering, mechanical innovation and personnel training. At the same time, the article gives strategic suggestions to enterprises on how to improve their competitiveness, expand scales and establish strategic alliance, and put forward specific steps on the operating and macro-managing of the enterprises...