Market Game and Efficiency Analysis of Monopoly Industry after Entry Deregulation——An Example from China's Power Market

After the entry deregulation of monopoly industry,the policy-related entry barriers were removed,as a result of which the incumbent monopoly enterprises are facing the threat of potential entry of competitors. The theoretical model shows that compared with the situation with non-access threats,the incumbent monopoly threatened creates an excess installed capacity beyond the profit- maximizing output. Then,by the efficiency analysis of oligopolistic enterprises in China's power market,the existence of diseconomies of scale and the scale efficiency decreasing of large-scale power generation enterprises was confirmed. Finally,this paper presents some proposals,such as further split,asymmetric regulation and anti-monopoly etc.