Empirical Analysis on Economic Efficiency of Conglomerate Operation in Urban Commercial Sectors

It was traditionally thought that fierce competition led to a lower profit Margin. However our research shows business concerned in the urban area is more profitable under conglomerate operation than under the other way round.. More business opportunity under centralized competition, though benefit rates a little bit lower than scattered sectors distribution, but overturn and absolute profits higher than scattered operation. This paper is based upon a comparison between conglomerate and scattered operation. Statistical inference and fixed effect model have been applied to come to the following conclusion, which is the same as widespread opinion: sectors, more conglomerated competition more competitive, then general level of profit getting lower, but overall economic efficiency is more promising. Put forward to the suggestion that so the author thinks the every urban area should be divided into several functional districts to get,,different industry operated is a centralized way. In this way both benefits of consumers and dealers could be improved and balanced.