Theoretical Model Of Standard Competition And Cooperation

Since the reform and opening, standardization has got positive progress in China. But generally speaking, the standardization of China is still seriously lagging behind in economic and social development. The hysteresis mainly performances as follows:the lack of standards, lagging aging, cross-contradictory, low quality and technical level, weak power of international standards speaking and other aspects, which restricts the development of economy and society. An important reason for these problems is that China's standardization system was formed in the planned economy period and can not meet the market needs of economic development. In the standard system, the single government-led-supply standard system can not play a decisive role in market allocation of resources and it is difficult to play a better role of the government, which restricts the supply and the effective implementation of standards; Furthermore, for the standard management system, dispersed management standard directly result of fragmentation and "debris", which affects the overall performance of standardization. To solve these problems fundamentally, standardization system reform should be promoted simultaneously while the transition process of planned economy to a market economy.Standard taken as the technical basis of economy and social activities is an important basic technology institution of a nation. Standardization has become an important tool to realize the modernization of national governance system and governance ability. The industrial revolution directly led to the modern standardization which is applied to all kinds of fields from industry to agriculture, services and social public management gradually and extended to every aspect of human economic and social development, which plays an increasingly important roles in standardizing enterprise production, improving product quality, maintaining the market order, promoting technology progress, supporting the industry development and facilitating foreign trade, etc. Take economy and trade as examples, according to the U.S. Department of Commerce statistics, more than 80% of the global trade are under the influence of standardization. Therefore standardized level embodies the modern level of national governance system and governance ability in a larger extent.Standardization has been promoted to a national strategic height. With the international perspective, a national standardization strategy has been introduced to strengthen the standard research and enactment in US, UK, Germany, Japan and other developed countries. They race to control a commanding point of international economic, trade and the competition of technology by means of standardization, which leads the industry and technology development and furthermore enhances the national competitiveness. With the domestic perspective, the government promotes standardization to an unprecedented important position. From The Decision on Major Issues Concerning Comprehensively Deepening Reforms which was adopted at the close of the Third Plenary Session of the 18th CPC Central Committee, the standard along with the development strategy, planning and policy are taken as important means to perform the functions of government and 5 aspects including market access, transformation of government function, culture, education and national defense construction put forward clear requirements to standardization. The Program for Institutional Reform and Functional Transformation of State Council adopted by the 1st Plenary Meeting of the 12th National People's Congress stated explicitly that the standard was a nation's basic institution. The strategic position and basic function of standard are becoming more and more prominent in our country's economic society development.Standardization system has become one of the important content and the hot issues in China's economic system and current administrative reform. From the study abroad, the standard management system of developed countries, through 100 years of development, has developed mature and stable. Therefore, there are few literature focusing on national standard system reform issues. During 1985 to 1995, some foreign scholars introduced the study of economics to standards forming many standard economic literatures. These literatures mainly involve standard policies, market supply of standard, government intervention in standardization activities, standardization motivation, standard technological innovation, international trade impact analysis, etc., which are directly related to the standard system issues. While in our country, the discussion on the standard system reform issues is very heated. The related research focuses on three aspects. The first aspect is international comparative study on the proposed of putting forward the inspiration and reference of standard system reform. The second aspect is mandatory standards attribute discussing the construction of technical regulation system in our country. The third aspect is technical research concerning the advancement, scientificity and applicability of standard. Besides, the third aspect also includes simplification, coordination and harmonization of standard and involves the perfection of the standard revision. However, these studies remain mainly in the phenomenon, technology and international comparison. They not only lack of theoretical study in depth and nature reveal, but also lack of the system design of structural and mechanism reform. Therefore, this article mainly studies the reform of standard system reform in transition period from Chinese planned economy to market economy and carries out theory and policy research of standard system reform, which provides support and policy advice to standard system reform.Based on the problem-oriented and the practical problems of deficient standard system and unsmooth standard management system in our country, and on the review about existing research, apply economics, new institutional economics, public management and relevant theory of law to establish a standard system analysis framework, study the relationship between the supply and demand of standards, build a standard interests competition-cooperation model based on interests consistence, explain the problems and essential reason in China's current standard system theoretically, and carry out verification research in view of historical evolution, international comparison, data and cases of the standard system in our country, and then put forward the ideas and measures for the standard system reformation for our country.Besides introduction and conclusion, the main research contents of this paper are divided into four parts according to the logical sequence of problem analysis, reason analysis, model building and policy suggestions. Problem analysis are included in Chapter 2, revealing the contradiction between the supply and demand. Reason analysis are included in Chapter 3. Model building is included in Chapter 4, in which the standard competition-cooperation model based on interests consistence is built and discuses how to solve these problems. Policy suggestions are given in Chapter 5, in which some reformation ideas and measures are proposed and how to solve some real existing problems are also discussed.Chapter 2 first lists the main shortage problems of China's standard supply. Then, by roughly drawing the outline of the development of standardization from old ancient to the founding of P.R. China, summarizes the regularity of standardization activities and describes the relationship between the demand and supply of standards. First, standardization is the results of human practice, which originates from the practice, is rooted in the practice and serves the practice in return, it originates from production practice, and develops along with the development of the production. Second, the level of productivity development, practice exploration progress, science and technology progress and economic and social development, determine and restrict the development level of standardization. Third, productivity development puts forward the demand for the standards, the demand of the standards leads to the supply of standards. From the relation between productive force and production relations,and from the definition of standard and the regularity of standardization itself, total standard supply can't keep up with the total standard demand on the whole and there exist the gaps between the standard supply and demand, they constitute an unity of contradictions generally.After summarizing the objective facts and regularity on the standardization activities and the economic and social development, and on the supply and demand of standards, and further abstracting and modeling, the gap models about the supply and demand are established finally. The historical evolution of China's standard supply and demand has verified that the standard supply can't to satisfy the total standard demand is the general contradiction of standardization activities and that the model on standard's supply and demand is scientific and reasonable.It is pointed out that there exist not only general contradiction of the total supply cannot to keep up the total demand, but also the significant structural problems. The standard supply is not only shortage but also excess for supply side. In the case of the government is only standard supply side in our country, however the standard actual need side are of (enterprise-based) social organizations, their enthusiasm to supply standard is suppressed because of the standardization legal and institutional restrictions. Standards adapted to fast changes of the market and to the fast technical update and short product cycles are not sufficiently supplied by the government itself. This leads to standard serious "shortage" in many areas especially in the high-tech area. The government as a single standard supply side strives to maximize the budget to develop a greater number of standards as its main motivation, rather than to take a real effective demand of the standards as its constrains, leading to the presence of a large number of ineffective or unnecessary standards known as "excess" of the standards.Chapter 3 apply the general principles of economics to further analyze the contradiction between standard supply and demand and its reasons. As a kind of technology system, standard belongs to public products, which has a prominent positive externalities, difficult in pricing and market mechanism invalid. For standard requirements side, the price of standards is extremely low and the revenue is relatively large, and the demands are determined by the level of productivity development and has no flexibility to price. For standard supply side, the cost of the standards is high and the income is small. At the condition of lower standard prices, well below the price of the equilibrium of supply and demand, the supply of standard is far lower than the demand under the equilibrium condition of supply and demand, which leads to a big supply shortfall. Supply and demand distortion and supply gap are caused by the distortion of standard interest mechanism, and the distortion of benefit mechanism is rooted in unreasonable standard system, in which the government is the only standard supply side under planned economy system in China. This makes the public finance funds become the actual price of standard supply, which is much lower than the price to approach the standard supply and demand balance, therefore make supply side lack effective incentive. There are two methods to solve the gap between standard supply and demand. The first one is to increase the invest of the government's public finance to the standard supply side, but it is difficult to continue development; the second approach is innovation of the standard supply system which is a long-term strategy.The Cole theory about planned economy and the shortage economy is employed to analyze, the "price" is not the main facter to motivate or constrain a standard supply and demand behavior. Assuming the standard "no price" and the government as the standard "producer", the main constrain is capital investment and technical capability to develop the standards. The standard "producer" in the production of standards will not be restrained by the effective demand. Therefore, a "no price" models about supply and demand is further established which interprets why exists the structural problems in the standard supply in our country.We make a further summary and abstract on the structural problems of the standard supply in our country and divide the standards into two categories:government standards and group standards. In China the "excess" standard supply mainly come from government and "shortage" mainly from the voluntary groups. By use of "no price" model on standard supply and demand, we can conclude that the government (the standard maker) and the enterprise (the standard demand side) have the different interests preferences, there is inconsistency between the standard maker and user's requirement for the standards, the government preference is to expand the supply of government standard while the voluntary group's preference is their voluntary demand for the standards. Under budget and capability constraints, both of the utility function and the utility curve for the government and enterprise are not consistent. Compared with the demand for enterprise standards, the government's standard supply is "surplus" and while the voluntary group's standard supply is "shortage". According to this theory, non-consistent of the planned supply and market demand of China's standards are the fundamental reasons for the coexistence of supply surplus and shortage.Based on the theory of supply and demand, a basic idea to solve "excess" and "shortage" of the standard supply in China is to change the separated status of supply and demand and unify the standard setting and standard demand, and constitute the unity of a interest consistency on the standard system and the standard setting are restricted by real needs. For instance, the standards should be classified into categories according to the requirements for government's standards and the requirements for enterprise standards, to break the single standard supply system of the government and to make the government and the market to their own position. The government mainly provides the mandatory standards. While the social organization of enterprises provides voluntary standards in accordance with the market mechanism and to establish a new standard setting systems consist of the government dominated mandatory standards and markets dominated voluntary standards.On the basis of the analysis on the contradictions about the standard supply-demand, Chapter 4 studies the internal mechanism about the competition-corporation of standardization. There exists competition and corporation among stakeholders in standardization. Suppose setting the standard is completely competitive, there exists only a large number of dispersed factual standard (enterprise standard) in the market, which benefits to market competition, but the transaction costs are very huge, and ultimately harm the common interests of market players; Suppose standard setting is completely corporative, there exists only centralized national standards, which will help coordinate and reduce transaction costs, but suppresses competition in the market, and ultimately will harm the common interests of market players. Therefore both of the two forms are not the best one of the standard, which is unstable form. Based on the trade-offs of costs and benefits, and driven by the consistent interests of reducing costs and increasing revenue, the market players tend to have a certain cooperation from the completely competitive, and tend to have a certain competition from the completely corporation to achieve the best combination of coordinating costs and benefits and form a more stable form of the standard.In a stable standard system, the government, society and market belong to their places and share governance, which are responsible for supplying pure public government standards (cooperation standard), quasi-public social standards (competition and cooperation standard), pure private market standards (competition standard) respectively, each standard not only meets its own needs, but also coordinates and supports collaborative linkage, to form a scientific, rational and stable structural standard system.Whether developed countries with market economy, or countries transformed from a planned economy to a market economy, the scientific and reasonable characteristics of standard competing-cooperating models are validated by the common characteristics and evolution of standard system. At present, China is transforming from the mode of a single government supply standard to the mode of social pluralism supply standard.By means of the standard competing-cooperating model based on consistent interests, Chapter 5 aims at the outstanding problems of the current standard system, revolved around shared governance of government, market, social, and make recommendations to deepen reform of standard system.The general idea of the reform of standard system is, in the process transforming from planned economy to market economy, the reform of standard system must aim at adapting and promoting the development of the socialist market economy, to make the market play a decisive role in allocating resources and play the role of government more well, adhere to the strategic, systematic, regular, gradual manner, handle the relationship between government and the market, the community, change from the planned system, government regulation, a single supply mode to a market system, shared governance, multiple supply mode. The standards are divided into three category:pure public goods nature, quasi-public goods nature, pure private goods nature which mainly embodies government standards, group standards, corporate standards respectively, and the government, social organizations, enterprises are responsible for the supply correspondingly, accelerate the construction of new standard system with government standards as the foundation, social organizations as the main criterion, the joint development of various standards.The main measures of standard system reform are as follows:First, simplify government mandatory standards. Cancel the existing mandatory industrial standards and mandatory local standards, which should be integrated into mandatory national standards; limit the scope of the mandatory national standards as the protection of national security, protection of life health and safety, environmental protection, prevention of fraud, to realize substantial "downsizing". Comprehensiving standards and legislative procedures, the mandatory national standards must be formulated and approved for release by the department of standardization administration under the State Council.Second, optimize government recommended standards. Located with only a recommended national standard, cancel recommended industrial standards and recommended local standards; recommended national standards mainly formulate social welfare standards that the market is not suitable, willing and able to formulate, including the basic and common standards and standards supporting for mandatory standards; leave the recommended standards that are suitable to the scope of development to the appropriate industrial organizations gradually, directly translated into voluntary social organizations standards.Third, quicken the process of developing group standards. Give it a legal status by amending the law, marking no political nor market permission, choosing the excellent ones by free market competition. Government should make guidelines on developing group standards and codes of good conduct, to guide the healthy development of group standards. Establish assessment mechanism by third social group based on independent and justice, to evaluate voluntarily the organization of group standards. National standardization administration use the government purchase service commission standards groups to take on the national standard setting work, or will be in accordance with the conditions of group standard directly adopted into the national standard, to effectively incent development of outstanding group.Forth, open and invigorate enterprise standard. It will be no longer a formal standard being administered by amending the law. Cancel the requirement of enterprise standard registrtion with goverment and establish enterprise standard information disclosure regulation to make effective restraint to the enterprise to improve its level of standards and quality of production and service.Through these reform measures, in the new standard system mainly composed of government standards and group standards, establish the mechanism of the internal relation among the different standards, laws and regulations, mandatory national standards and recommended national standards, national standards and the standards bodies, forming an organic national technical specification system. Through gradual reform relying on the "subtraction" of government standards and the "addition" of group standards and continuously improving the standard of supply to meet the standard demands, solve problem of standard quantity, speed, quality and efficiency, actively and steadily to achieve expected objectives of the reform.While building a new standard system, we also speed up the transformation of the functions of our government standardization management institutions. The establishment of a national high-level and standardization advisory and coordinating organization, the drafting and implementation of national standardization strategy, promoting coordinated development of the standard system reform, coordinating major standard-setting. Strengthen the national standardization administration department of the unified management and comprehensive coordination to standardization work. When the conditions are ripe, the specific formulation of the national standard shall be entrusted to the non-profit organizations. Industrial and local standardization management agencies focus on promoting the implementation of standards and provide public services for the community, and the main role of making standards should be all the stakeholders relating to it. To cancel the national standards project approval and financial subsidies, reduce the standard "Rent-seeking" behavior of stakeholders to the greatest extent, reduce the distortion of standard supply and demand and assurance standard effective supply.