Iron And Steel Industry Capacity Utilization Measure In Liaoning Province And Influence Factors

Iron and steel industry is engaged in ferrous metal mineral processing and ferrous metal smelting processing and other industrial production activities of the industry,is the most important national economy development of basic industries,and therefore known as the industry "food".As China’s old industrial base,Liaoning Province,the iron and steel industry started early,has high output and fast development.It’s the pillar industry of industrial economy and drive Liaoning Province’s economic growth.However,with China’s economy into the new normal,economic growth slow down,steel industry capacity utilization continued to decline,there has been a serious overcapacity,which take a lot of negative effects in economic development,the steel industry’s growth and the economic benefits of enterprises in Liaoning ProvinceThe paper analyzes the influencing factors of capacity utilization in Liaoning province,and then discusses the countermeasures and suggestions to improve the utilization rate of steel in Liaoning Province,which can help to improve the utilization rate of production capacity,promote competitiveness of the steel industry,set an example for other related industries.This paper first combs the theory of capacity utilization at home and abroad,including the definition of production capacity,measurement method of capacity utilization and its influencing factors and overcapacity research.After comparing the four commonly used measures,the production function method was used to calculate the capacity utilization rate of the iron and steel industry in Liaoning Province from 2005 to2014 through the classical Cooper Douglas production function.Compared with the major steel production areas in China,Liaoning’s capacity utilization is low,especially before 2011,capacity utilization is generally between 40%-70%,after 2012,capacity utilization rate is declining.In order to analyze the reasons of low utilization rate of steel in Liaoning,seven influencing factors were obtained from the four aspects of system,economy,industry and enterprise,and gray correlation analysis was used to calculate the gray between these influencing factors and capacity utilization.The main factors that affect the utilization rate of steel production in Liaoning Province are the local government investment,the industrial technology level,the market concentration and theproportion of state-owned enterprises.According to the results of gray correlation,we put forward some policy suggestions to improve the utilization rate of the industry:First,reduce the local government intervention and eliminate the backward production capacity;Second,improve the capability of independent innovation and optimize the steel production structure;Third,improve the industry access threshold and speed up the merger and reorganization;Fourth,deepen the SOE reform and moderately encourage efficient private firms to enter the industry.