What are the reasons for the relaxation of government regulation

MonopoliesMonopoly industries, as the solid name implies, are industries that enjoy state-given policies for social production and thus control, manipulate, and monopolize the market. However, there are some monopoly industries, such as: salt, tobacco, electricity, finance. These industries also have the flavor of planned economy, exclusive trading, people put it impossible to live, the product is the only choice. Therefore, it is also known as hegemonic industries. These industries are the products of the emperor's girl mentality. Both in the theoretical analysis of the social reality, the monopoly of public enterprises has attracted many shortcomings. Therefore, in the practical mechanism to introduce competition and break the monopoly of many countries of public **** enterprise reform. In the process of building and improving the socialist market economic system, China's legislative and executive branches continue to take measures to regulate the monopolistic behavior of public enterprises. Taking into account China's national conditions, in the ensuing period, domestic antitrust regulation of public *** enterprises should focus on the following aspects: price regulation to ensure interoperability and prohibition of cross-subsidization. The traditional antitrust law, monopolistic public **** enterprises, the application of the object of the exception, only in the cost of services and prices of the operator for strict control. However, with the development of modern public enterprises, antitrust laws, increasingly bound by the antitrust laws. Currently, China is in the process of formulating an anti-monopoly law, and the regulation of anti-monopoly public enterprises is an important issue facing the inevitable. Here, I take a legal and economic analytical approach to the establishment of a legal system for the anti-monopoly regulation of public enterprises. First, the economics of the analysis of corporate monopolies and disadvantages of public *** transportation, telecommunications, electricity, water, natural gas and other natural monopolies in the industry of the enterprise, including the common reason that its products or services are closely linked together and indispensable with people's daily life. (A) public **** enterprise monopoly reasons scholars have pointed out that in the U.S. telecommunications industry to visit the historical development of the U.S. telecommunications industry "natural monopoly" is not innate, initially formed to the Western Union and the American Telephone and Telegraph Company (AT & T) monopoly of the U.S. in the competitive environment, with a series of mid-term development of the telecom industry. Technological inventions, innovations, and competition for the rights of the franchisees triggered lengthy lawsuits and negotiations to form. [1] The rules of "entry" into the telecom industry at the beginning of the game were influenced by changes in the privacy, autonomy and inviolable property rights of the "power item (property)" and changes in market structure, and ultimately led to the formation of a natural monopoly, rather than a state monopoly. Thus, the contest of monopoly power, in addition to the contest with competitors, but also a fierce contest with the state. With the formation of the monopoly situation, adjusting and regulating the order of competition in the market, the legal system is constantly improving. In our example, monopolistic public **** enterprises unreasonable reasons. [2] From the cultural point of view, China's economic tradition of "government-run" special economy from the Han dynasty salt and iron official camp "to" the foreign affairs movement "of the Qing dynasty, all with the official color of the monopoly. In the era of planned economy, the state power adopted in 1949 to realize the public ownership of the means of production, the monopoly of many industries under the monopoly of the state through revolution rather than competition to obtain this monopoly does not mean the inevitable logic of market economy. The state of the will of the state program, with some legal effect, under this arrangement, it is impossible to appear anti-monopoly laws, but only in obedience to the will of the state. See, the theory of natural monopoly, can not be the situation of public enterprise monopoly defense (B) the disadvantages of public enterprise monopoly. Poor market performance of public enterprises, where the natural monopoly industry, the efficiency of resource allocation within the industry direct negative impact due to the lack of competition, low profitability of the industry, industry or business, or unreasonable prices do not accurately reflect the market supply and demand. In order to maintain the development of reproduction or guarantee, public **** enterprises often rely on their own monopoly itself the burden shifted to the vast number of users and consumers, greatly reducing the social utility of the industry, for example, the Ministry of Posts and Telecommunications - China Telecom, a one-time purchase of the user's construction costs in the 1990s, the initial telephone in many cities? Installation fee amortization income rose to 4,000?5,000 yuan, thus the investment in expanding telephone capacity was mainly transferred to consumers. Charging such a high up-front connection fee, due to the lack of competitive pressures, the quality of service of the EMB, but no significant changes have occurred. From the performance of the industrial organization and internal enterprises, China's natural monopoly industry, the more general existence of high consumption of poor efficiency, inefficient operation of state-owned assets. [3] dual law industry market structure is irrational, public enterprises, public **** enterprise operators of the market rules, left by the government directly controlled, is the government and the enterprise's special business a high degree of unity, with the enterprise combined with the market operators and industry management position, because they have administrative monopoly operating rights, within a certain range, it is actually the government monopoly enterprises. , American economist Stiglitz has pointed out that government enterprises do not care about bankruptcy due to incomplete and asymmetric information, and usually do not consider competition. Bureaucratic management as a public enterprise, the overriding goal is to maximize the institution, not to optimize operational efficiency. Inefficient public enterprises. [4] Second, the efficiency of the public **** enterprises, the introduction of competition mechanisms, from the very beginning of the 18th century, economists have recognized that certain areas of the market economy, from the economic interests of the community, should not be a competition, it should be a monopoly, the public **** enterprises in the industry where, due to the high cost of laying pipes or lines pipe or line from the user's supply of only 1 lodging place is the economy, the public **** enterprises, the public **** enterprises, the public **** enterprises. Its products basically no storage capacity, only one consumer demand to produce, in the established market demand, production than the production of two or more than two enterprises can save social resources, this phenomenon is known as a natural monopoly in the case of the traditional theory of natural formation of monopoly, natural monopoly, because of the size of the economy and technological development. In addition, the natural monopoly industry investment and recovery time is long, once the fixed investment costs, often in the industry's "precipitation", which leads to higher precipitation funds, which is a natural monopoly of the conditions for the stable existence of. [5] However, many scholars put forward the opposite view, they believe that the market competition mechanism can automatically solve two efficiency problems: first, it can solve the problem of the entire industry cost structure of high efficiency, minimize the cost of production, the problem of effective price structure can be solved in accordance with the purchase price of the product is equal to the power of the consumer market marginal cost or average cost. Competition can promote production efficiency and resource allocation efficiency, [6] Unicom ENTER China's telecommunications industry is a typical example. Competition not only did not not lead to higher production and operating costs, but the lower cost levels forced China Telecom to cancel various inefficiencies, outweighing the positive effects of competition, reducing costs at the expense of certain economies of scale, and improving consumer welfare. See, the traditional theory of natural monopoly can not afford the test of practice. The limitations of the enactment of competition policies aimed at realizing economies of scale, protecting the interests of consumers and controlling public **** enterprises, in fact, did not achieve the goal. Some scholars have pointed out that the root cause of this phenomenon is that the flaws of this control strategy based on the establishment of the theory of natural monopoly. The theory of [7] ignores the fact that in any enterprise monopoly position will be fostered inefficiency, lack of competitive environment, the monopoly can not consciously pursue high efficiency there is a considerable deviation from the actual efficiency as high as possible efficiency. These new perspectives provided the theoretical basis for government policymaking, deregulation, and antitrust regulation of public utility enterprises. From the 1980s and 1990s, the public enterprises in the developed countries of the West, its theme of deregulation reform has been fruitful, breaking the monopoly of the public **** enterprises. In the country, with the deepening of the reform, the theoretical community began to pay attention to the issue of public **** enterprise monopoly on the initiatives taken by the government to solve this problem, has also achieved positive results, but, it should be pointed out that effective market competition, the public **** enterprises in the industry where the introduction of the theory of competition mechanism, not only to fully take into account the importance of the competition mechanism to optimize the allocation of resources, economies of scale, but also gives Full consideration of the development of the country's significant economic impact. Enterprises, industry characteristics and the economic theory of scale tells us that the monopoly public enterprises in the industry should be allowed to exist, even if the introduction of competition mechanism, the market structure is a monopoly type. Three, the possibility of antitrust regulation of public enterprises economic analysis and recommendations (a) analysis of the possibility of 1. Theory of Competitive Markets On December 29, 1981, the American New Welfare Economist, President Baumol, spoke at the American Economic Association, first articulating the theory of competitive markets The theory of competitive markets is that, as long as the government loosens its control over new businesses entering the market, the potential threat of competition will force the original monopoly within the industry to improve efficiency. Assumptions: (1) it is completely free to enter and exit the market (industry), relative to existing firms, potential entrants have no disadvantages in terms of production technology, product quality, cost, (2) potential entrants enter the market profitably, based on the assessed price level of existing firms; (3) potential entrants adopt a "hit and run" strategy, [8]. strategy, [8] and potential entrants have the ability to exit the market quickly. The theory suggests that the case of oligopolistic firms or monopolies is no exception. If in the real world there is no competitive market with excess profits, because any excess profits will attract potential entrants to the market share and profit division, the same cost and monopoly. The theoretical assumptions are entirely consistent with the power that can be relied upon to maximize social resources by relying on the power of the potential competition of the reality of competition, and government regulation should be abolished. However, in fact, the original industry within the enterprise can be made entirely before the price reduces economic efficiency, the optimization of the allocation of the operational response in the establishment of a new enterprise scale, the enterprise to exit the market will inevitably produce a kind of sunk cost, although the theory of the theory of the competitive market can be competitive market assumptions are inconsistent with the real conditions before the government regulation becomes necessary. It is flawed, but it has had a tremendous impact, economic parameters, and it is also possible to update the antitrust regulation of government-controlled monopoly industries (including public *** firms). Quasi-public **** goods, monopoly economic programs will be into pure public **** goods provided by the government, quasi-public **** products. Unlike the general public **** enterprise as being able to freely choose or exclusion, or at the same time transfer to downstream industry sectors and consumer exclusion and product more economic benefits, value, high cost themselves can also get service fees or sales staff compensation, such a product is a quasi-public **** product, public **** goods alignment, although the vast majority of countries are using some form of government monopoly , but it does not have a monopoly status. A quasi-public **** good, is a trade-off between government supply and private supply in a continuous balancing process. [9] When the supply of quasi-public ****goods from quasi-public ****enterprises is supplied by the private sector with public ****goods, and since private capital never has the bureaucratic drawbacks of appearing to be a low-quality, inefficient quasi-public ****goods, the private sector's demand for the supply of the upward tendency to satisfy the ? Sufficiently low profit impulse quality, it will stimulate the demand for quasi-public **** products of public enterprises. Sources of funds do not provide barriers to investment in quasi-public **** products, the value of public **** enterprises public enterprises' products in lieu of fully corresponding to the requirements of the profitability of private capital. Therefore, it is not excluded that private capital in China's public **** enterprises are mostly state capital investment, anti-monopoly regulation necessarily involves access to private (private) capital, and such issues should be taken up by the policy of opening up to private capital. (B) On the basis of the above analysis of the legislative proposals for natural monopoly business, China's antitrust legislation on public **** enterprises should apply to an oligopolistic market structure [10] The regulation of prices should focus on monopolistic behavior, specifically including price regulation to ensure interoperability, prohibition of cross-subsidization, prohibition of forced transactions, and discriminatory behavior in five areas. Supervision is to prevent the abuse of public *** business users and consumers to provide product development, development enterprises can be through three methods: first, the space of the existence of comparable product prices compared to the time to compare the application of comparable price calculations for similar products; third, the comparison of cost plus reasonable profit, which first determines the cost of the product or service, and then compared with the price of the enterprise profit whether there is reasonable. Interoperability in order to determine whether the network economy in the field to ensure the effective realization of the necessary conditions for competition between enterprises. An important feature of the vertical structure of the network industry, such as telecommunications, long distance, cellular and other value-added services, is the unique access to the city, and then to the city in which the service is provided, and then the basic input factor for long distance and other services. Therefore, the provision of network interconnection obligations between businesses is essential. The prohibition of cross-subsidization aims to achieve equal conditions of competition between firms, preventing firms from increasing non-competitive prices by reducing the prices of competitive items for the purpose of squeezing out rivals. Antimonopoly laws may provide that publicly owned enterprises must be a natural monopoly business and non-natural monopoly business divestiture composed of each separate legal entity that requires the separation of different commercial financial public **** enterprises.