Product Market Regulation and Competition in China
AbstractThe extent of competition in product markets is an important determinant of economic growth in both developed and developing countries. This paper uses the 2008 vintage of the OECD indicators of product market regulation to assess the extent to which China’s regulatory environment is supportive of competition in markets for goods and services. The results indicate that, although competition is increasingly robust across most markets, the overall level of product market regulation is still restrictive in international comparison. These impediments to competition are likely to constrain economic growth as the Chinese economy continues to develop and becomes more sophisticated. The paper goes on to review various aspects of China’s regulatory framework and suggests a number of policy initiatives that would improve the extent to which competitive market forces are able to operate. Breaking the traditional links between state-owned enterprises and government agencies is an ongoing challenge. Reducing administrative burdens, increasing private sector involvement in network sectors and lowering barriers to foreign direct investment in services would also increase competition and enhance productivity growth going forward. Some of the reforms introduced by the Chinese government over the past two years go in this direction and should therefore help foster growth.
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Bibliographic InfoPaper provided by Regulation2point0 in its series Working paper with number 648.
Date of creation: Dec 2010
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Other versions of this item:
- Paul Conway & Richard Herd & Thomas Chalaux & Ping He & Jianxun Yu, 2010. "Product Market Regulation and Competition in China," OECD Economics Department Working Papers 823, OECD Publishing.
- NEP-ALL-2011-03-19 (All new papers)
- NEP-COM-2011-03-19 (Industrial Competition)
- NEP-REG-2011-03-19 (Regulation)
- NEP-TRA-2011-03-19 (Transition Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Anita Wölfl & Isabelle Wanner & Tomasz Kozluk & Giuseppe Nicoletti, 2009. "Ten Years of Product Market Reform in OECD Countries: Insights from a Revised PMR Indicator," OECD Economics Department Working Papers 695, OECD Publishing.
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