Study On The Market Efficiency Of Natural Monopoly Industry

The reform of natural monopoly industry has always been one of the most heatedly discussed popular research subjects and topics in the fields of the economies of industries. It is also the nuclear problem in China's deepening reforming process of its economic system in the present situation. Due to the development of the economies of regulation and with its continuous intensifying influence on politics, a wide surge of reform concerning natural monopoly industry market has been taken place on a world wide scale since the beginning of 1980s in the 20th century and the reforming process is still continuing until today.Decades of years since China first began to adopt the policies of reform and opening-up, China has also started to carry out a market oriented reform in natural monopoly industry with the establishment of a socialist market economic system. The overall efficiency of the industries has been improved, the competitive force of enterprises has been increased, and the prices of many products have been decreased. There is obvious improvement in social welfare cause. However, there are still many remaining problems in this field such as vicious cycles of price competition, the obstacles in interconnection, deficient universal service in many areas and low efficiency in market competition. The existence of these problems has, on the one hand, reflected the common difficulties concerning the reform of natural monopoly industry faced by countries both home and abroad. On the other hand, it also reflected some particular problems and features in the process of our national transition of economic systems. In this way, the key and essential point of the reform of natural monopoly industry lies in how to improve the efficiency of market operation.On the basis of the above mentioned historical and objective background review, this paper has adopted the theoretical framework of the Theory of Industrial Organization used by western countries to discuss the evolution of natural monopoly theories and the conflicts in the efficiency of natural monopoly theories. It especially focuses on the research of moving and changing features concerning the border area of natural monopoly. Based on the comparison and analysis of the efficiency in the reforming process of natural monopoly industry of some overseas countries, it also makes a study on the efficiency of natural monopoly industry market in China and analyzed some suggestions and modes of development which have constructed the effective market of natural monopoly in China. The paper also put forward a mode of evaluation and its application methods concerning the efficiency of natural monopoly industry market. Finally, by using the examples of several natural monopoly industries in China and considering the present development situation of our country, it discusses some principles and effective practical measures concerning the improvement of market efficiency in our national natural monopoly industry reform.