A Comparative Study On The Market - Oriented Reform Of British And Japanese Railways

Railway has a fundamental role in the economy. It is the main artery of the national economy and has public attribute, reflected as non-competitive, positive externalities and utility indivisibility of the goods that the railway sector provides. While the public sector also faces a variety of problems, the most important is that it tends to waste and misuse of resources when provide public goods, resulting in excessive scale of public expenditure or reduced efficiency and inefficiency of government activities or interventions. These all result in Government Failure. Western countries, thus, giving rise to a wave of market-oriented reforms in the public sector.In China, the public attribute is particularly evident in the railway sector. On the one hand, there is a witch hunt and monopolies and other problems, on the other hand, it has commitment to the country’s military security, public transportation and other public missions. Thus, the debate if Chinese railway sector should be market-oriented reformed has always existed. This paper will attempt to depart from the perspective of Public Option School and New Public Management Theory, study the market-oriented reform of the United Kingdom’s and Japan’s railways, to propose some views that China’s railway market-oriented reform can learn from.This paper is divided into five chapters. The first chapter will summary the research of public goods, public sector and United Kingdom’s and Japan’s market-oriented reforms. The second chapter elaborates the public nature of Chinese railway sector and makes a description of theories of market-oriented reforms in the public sectors. The third and fourth chapter, respectively, studies the market-oriented reforms of the United Kingdom’s and Japan’s railway, analyzes the theoretical basis of their reform programs, and analyzes the reasons for the failure of United Kingdom’s railway reform and the reasons for the success of Japan’s railway reform. The fifth chapter first analyzes the differences of United Kingdom’s and Japan’s railway reform. Then, combined with both positive and negative experiences of United Kingdom’s and Japan’s railway reform and propose some implications for the market-oriented reform of China’s Railway.