Gains and losses from collusion: an empirical study on market behaviors of China’s power enterprises
Visualitza/Obre
Estadístiques de LA Referencia / Recolecta
Inclou dades d'ús des de 2022
Cita com:
hdl:2117/84440
Tipus de documentArticle
Data publicació2015-07
EditorOmniaScience
Condicions d'accésAccés obert
Llevat que s'hi indiqui el contrari, els
continguts d'aquesta obra estan subjectes a la llicència de Creative Commons
:
Reconeixement-NoComercial 3.0 Genèrica
Abstract
Purpose: Collusion is a common behavior of oligarch enterprises aiming to get an advantage
in market competition. The purpose of the research is to explore positive or negative effects
from the electricity generation manufacturers’ collusion through statistical analysis approach. To
be exact, these effects are discovered both in market economy at a macro-economic level and in
enterprise behaviors at a micro-economic level.
Design/methodology/approach: This research designs a model as an extension of Porter’s
model (Green & Porter, 1984). In this model FIML is applied. Taking price bidding project
launched in China’s power industry as an example, this paper conducts an empirical research on
its relevant price data collected from subordinate power plants of China’s five power generation
groups in the pilots.
Findings: It is found in this paper that power generation enterprises are facing collusion issues
in the market. To be exact, it is such a situation in which non-cooperative competition and
collusion alternate. Under the competition, market is relatively steady, thus forming a lower
network price. It is helpful to the development of the whole industry. However, once Cartel is
formed, the price will rise and clash with power enterprises and transmission-distribution
companies concerning the interests conflicts. At the same time, a higher power price will form
in the market, making consumers suffer losses. All of these are bad for industry development. Not only the collusion of power enterprises affects power price but also the market power that
caused by long-time Cartel will reduce the market entrant in electricity generation. Market
resources are centralized in the hands of Cartel, causing a low effective competition in the
market, which has passive effects on users.
Implications: The empirical research also indicates that collusion undoubtedly benefits the
power enterprises that involved. As a cooperation pattern, collusion can lead to the synergy
between relevant companies. However, collusion harms the benefits of other market entities.
During the process of enterprises creating common interests cooperatively, collusion may bring
harm to the outside industry.
Originality/value: Using empirical research method, the paper takes China’s power industry as
an example to show the gains and losses of collusion from two aspects, namely market
economy and strategic management.
CitacióGao, Ruize [et al.]. Gains and losses from collusion: an empirical study on market behaviors of China’s power enterprises. "Journal of Industrial Engineering and Management", Juliol 2015, vol. 8, núm. 3, p. 946-962.
Dipòsit legalB-28744-2008
ISSN2013-0953
Fitxers | Descripció | Mida | Format | Visualitza |
---|---|---|---|---|
1515-7627-1-PB.pdf | 359,3Kb | Visualitza/Obre |