Research On The Measurement And Improvement Path Of China's Rare Earth Industry's International Market Power

With extraordinary physical and chemical properties,rare earth is widely applied in military industry,electronic information and aerospace.China has the largest reserves of rare earth,with complete minerals and absolute advantages in resource endowment.However,as the major supplier of rare earth,China lacked the exported pricing power of rare earth for a long time,which leads to a weak international market power.In 2014,the loss of “Rare Earth Case” lawsuit in WTO had an adverse impact on Chinese rare earth industry.After the export control policy was abolished,the export price of rare earth have been falling.With the launch of the Strange Lake mine project in Canada,the discovery of rare earth deposits in South Africa and other countries,the supply of international rare earths is increasing,and the rare earth industry in China is facing a more severe survival and development environment than ever before.Strong international market power is a prerequisite for China's rare earth industry to truly transform its resource advantages into economic advantages and competitive advantages.Therefore,the improvement of the international market power of rare earth industry has important practical significance for the rapid development of China's rare earth industry and the improvement of export bargaining power.Based on the analysis of the international pattern of rare earth supply and demand,this paper uses SMR measurement model to measure the international market power of China's rare earth industry in the overall international market,American market and Japanese market.,and introduces policy dummy variables in the overall measurement.Policy dummy variable is applied into the overall measurement to analyze the impact of export-control policies on the international market power of the rare earth industry.According to the measurement results,the reasons for the lack of power in the international market of rare earth industry are analyzed from both domestic and foreign perspectives.Finally,game theory is applied to analyze the game of rare earth suppliers and rare earth enterprises,and explore the main path to improve the international market power of rare earth industry under the abolition of export control policies.It shows that:(1)In the overall international trade of rare earths,there is a big country paradox in rare earth exportation,China exported a large amount of rare earth,but lacked the international market power.In the trade with japan,China has an advantage over Japan in international market power relatively,but that doesn't match the supply proportion(65%).In the trade with US,China lacks the international market power relatively due to geographical relationship and low dependency on China's rare earth.(2)The international market power in export-control period is absolutely higher than that in export-encourage period,which means export-control policy is helpful to raise up the international market power of rare earth industry and reflect the necessity and urgency to search for new upgrading paths after the failure of the “rare earth case”.(3)Low market concentration,unbalanced product structure,lax export control in domestic,and international capital monopoly,possession of high technology and strategy of rare earth reserve in foreign result in the lack of the international market power in China's rare earth industry.(4)According to game theory,the improvement of the international market power of rare earth industry can be considered from the perspective of full cost accounting,industrial concentration and technological innovation.The minimum alternative rates for resource taxes are 7.12%,9.49%,and 11.86% respectively when the tariff rates are 15%,20%,25%,which is measured by historical data.Based on the research above,this paper provide several advices about resource tax rate setting,technological innovation,association management to help government and enterprises making develop strategy.