Research On The International Industrial Market Power Of China's Garment Industry

The traditional trade theory point out that the countries can enhance their domestic welfare if they specialized in the world trade according to their comparative advantage. After opening, with the advantage of abundant labor resources, China's garment industry has conquered the world market with low price and high quality products quickly; the volume of trade and the market share of China's garment industry has been increasing steadily. But our country's garment industry competing in the world market is relying mainly on the primary factors; the added value of their product is small and their position in the international division is low. Therefore, it appears the situation that the competitive welfare that they gained deviates from what they should gain. In recent years, as the production cost of domestic China's garment industry is rising, the competition in the international market is getting fiercer, China's garment exports involving continued anti-dumping accusation, the survival and development of the garment industry is facing severe crisis. Market power was enterprises dominative ability to influence and control the price of product. The industry with strong market power can get more competitive in the global competition and more comparative advantage. So it is of great significance to analyze the bottleneck that blocks the development of China's garment industry and find out the way to break it.On the basis of the above backgrounds, this paper discussed the market power theory, pointed out that the construction of industry market power is an effective way to enhance the garment export performance, and revealed the positive function and urgency of cultivating of China's garment industry market power in global competition. This article analyzed the status of China's garment industry firstly; found that the export of garment industry showed increasing in volume and price reduced, deteriorating terms of trade exports, and clothing exports fall into "immiserizing growth" dilemma. We make an empirical analysis of actuality of domestic apparel industry's market power, and then applied Goldberg & Knetter's surplus demand elasticity model (1999) to examine domestic HS(1992)610910 products'market power in the United States Japan and Hong Kong market. And comparative analysis the international market power of Chinese, Italian, Vietnamese garment products in the Japanese market. The result indicated that our apparel industry did not gain trade benefit and price-plus ability relevant to the international market share of this product. The paper explores that negative tach of value chains excessive price competition and the traditional cost advantage gradual lost, are the three main reason lead to the lack of international market power.Based on the above analysis, we bring out corresponding proposals to construction the market power to enhance the trade interest of garment industry. Such as increasing investment in human capital to improve the quality of practitioners; to encourage the metastasis of apparel industry in the coastal areas to consolidate existing comparative advantage; cultivate innovation ability, adhere to the differentiation development strategy; implementation of brand strategy, to build international brands; optimization of industrial organization, to strengthen the Government and industry associations'regulatory role and other aspects.