INDUSTRIAL CONCENTRATION IN MAINLAND CHINA - CHANGES AND PROBLEMS

This paper is a first attempt to examine the problems of industrial concentration in mainland China during the reform period 1980-90. The evidence shows that mainland China's industry had not only had a remarkably low level of concentration, but the concentration trend has been downward, with almost all industries witnessing a decline in enterprise size. A great proportion of enterprises are small and these small enterprises absorbed a relatively high proportion of industrial capital and labor. Large enterprises suffered from insufficient supply of the factors of production. The factors which influence concentration changes have been identified as high industrial growth, the expansion of capital and employment, rapid changes in the numbers of enterprises, and the impact of government policy on mainland China's industry.