The Research On The Market Market Power Of Chinese Commercial

Price-cost margin is the standard method of measuring market power. It is difficult to measure the market power in banking because the marginal cost is hard to be obtained. Now we lack of the method of measuring the single bank's market power. So in this paper, attempt to use the The Lerner Index to estimate the market power.It is found that the State-Owned banks' market power is very strong by studying. And the banks' market power is increased with the market share of bank. As the time gose by, the State-Owned banks' market power is decreasing gradually; Contrarily the joint stock commercial banks' market power is increasing slowly. This paper investigates the relationship between the market power and the banks' asset profits, and the results show that the market power and the banks' asset profits showing a negative correlation.At last the paper conclude that to improve the banks' efficiency the government should deregulate administrative control, and encourage all the commercial banks participating in market competition. So that our commercial banks" competitiveness could be enhanced and the operational efficiency could be improved.