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The role of subsidies for exports: Evidence from Portuguese manufacturing firms


  • Armando Silva

    () (nstituto Politécnico do Porto- ESEIG. Rua D. Sancho I, 981, 4480-876 Vila do Conde, Portugal.)


Production subsidies have not been used by International Business literature to explain firms internationalization processes. We argue subsides may have a role to play in that process. Using a longitudinal database (1996-2003) at the plant level, this paper aims to shed light on the causal nexus between production-related subsidies and exports, in Portugal. We implement a propensity score matching approach in order to evaluate the effects of subsidies on both the probability of domestic firms to begin exporting and on the probability of increasing the export share of already exporters. We find no impact of subsidies on the ability of domestic firms to become exporters; additionally, no effects of subsidies are detected on export shares. Such disappointing results may be explained by the inefficiency in the granting criteria.

Suggested Citation

  • Armando Silva, 2011. "The role of subsidies for exports: Evidence from Portuguese manufacturing firms," GEE Papers 0035, Gabinete de Estratégia e Estudos, Ministério da Economia, revised Feb 2011.
  • Handle: RePEc:mde:wpaper:0035

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    References listed on IDEAS

    1. Richard Blundell & Monica Costa Dias, 2000. "Evaluation methods for non-experimental data," Fiscal Studies, Institute for Fiscal Studies, vol. 21(4), pages 427-468, January.
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    Cited by:

    1. Filipe Silva & Carlos Carreira, 2011. "Financial Constraints and Exports: An Analysis of Portuguese Firms During the European Monetary Integration," Notas Económicas, Faculty of Economics, University of Coimbra, issue 34, pages 35-56, December.

    More about this item


    Subsidies; Exports; Portugal; Matching;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • H29 - Public Economics - - Taxation, Subsidies, and Revenue - - - Other

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