Using a unique firm level data set from the Chinese manufacturing sector, this paper analyses the impact of production subsidies on firms’ export performance. It documents robust evidence that production subsidies stimulate export activity, although this effect is conditional on firm characteristics. In particular, the beneficial impact of subsidies is found to be more pronounced amongst profit-making firms, firms in capital intensive industries and those with previous exporting experience. Compared to firm characteristics, the extent of heterogeneity across ownership structure (SOEs, collectives and privately-owned firms) proves to be relatively less important.
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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number
6052.
Find related papers by JEL classification: F1 - International Economics - - Trade O2 - Economic Development, Technological Change, and Growth - - Development Planning and Policy P3 - Economic Systems - - Socialist Institutions and Their Transitions
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