IDEAS home Printed from https://ideas.repec.org/p/red/sed015/1247.html
   My bibliography  Save this paper

One State, Many Regions: China's Fragmented Industrial Takeover

Author

Listed:
  • Myrto Kalouptsidi

    (Princeton University)

Abstract

In recent years, Chinese firms have rapidly dominated a number of capital intensive industries (steel, solar panels, shipbuilding) in world markets. At the same time, China's domestic industries are fragmented: on one hand, there is substantial regional industrial duplication due to China's decentralized bureaucracy; on the other hand, even within provinces, these industries tend to be characterized by a large number of small firms. In this paper, we study the role that industrial policy has played in China's (fragmented) industrial takeover. We first document and measure the support provided by Chinese provincial governments. We then ask what their impact is on global (mis)allocation and welfare. We explore the unintended consequences of provincial competition driven by non-market based policy instruments, such as excess capital expansion. Finally, we study the consequences of consolidation policies brought forward by the central government.

Suggested Citation

  • Myrto Kalouptsidi, 2015. "One State, Many Regions: China's Fragmented Industrial Takeover," 2015 Meeting Papers 1247, Society for Economic Dynamics.
  • Handle: RePEc:red:sed015:1247
    as

    Download full text from publisher

    File URL: https://economicdynamics.org/meetpapers/2015/paper_1247.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Patrick Bajari & C. Lanier Benkard & Jonathan Levin, 2007. "Estimating Dynamic Models of Imperfect Competition," Econometrica, Econometric Society, vol. 75(5), pages 1331-1370, September.
    2. Kyle Bagwell & Robert W. Staiger, 2001. "Strategic Trade, Competitive Industries and Agricultural Trade Disputes," Economics and Politics, Wiley Blackwell, vol. 13(2), pages 113-128, July.
    3. Peter Thompson, 2001. "How Much Did the Liberty Shipbuilders Learn? New Evidence for an Old Case Study," Journal of Political Economy, University of Chicago Press, vol. 109(1), pages 103-137, February.
    4. James Levinsohn & Steven Berry & Ariel Pakes, 1999. "Voluntary Export Restraints on Automobiles: Evaluating a Trade Policy," American Economic Review, American Economic Association, vol. 89(3), pages 400-430, June.
    5. Brandt, Loren & Van Biesebroeck, Johannes & Zhang, Yifan, 2012. "Creative accounting or creative destruction? Firm-level productivity growth in Chinese manufacturing," Journal of Development Economics, Elsevier, vol. 97(2), pages 339-351.
    6. C. Lanier Benkard, 2004. "A Dynamic Analysis of the Market for Wide-Bodied Commercial Aircraft," Review of Economic Studies, Oxford University Press, vol. 71(3), pages 581-611.
    7. Brander, James A., 1995. "Strategic trade policy," Handbook of International Economics,in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 27, pages 1395-1455 Elsevier.
    8. N. Gregory Mankiw & Michael D. Whinston, 1986. "Free Entry and Social Inefficiency," RAND Journal of Economics, The RAND Corporation, vol. 17(1), pages 48-58, Spring.
    9. Stephen P. Ryan, 2012. "The Costs of Environmental Regulation in a Concentrated Industry," Econometrica, Econometric Society, vol. 80(3), pages 1019-1061, May.
    10. Myrto Kalouptsidi, 2014. "Time to Build and Fluctuations in Bulk Shipping," American Economic Review, American Economic Association, vol. 104(2), pages 564-608, February.
    11. Myrto Kalouptsidi, 2014. "Detection and Impact of Industrial Subsidies: The Case of World Shipbuilding," NBER Working Papers 20119, National Bureau of Economic Research, Inc.
    12. Maggi, Giovanni, 1996. "Strategic Trade Policies with Endogenous Mode of Competition," American Economic Review, American Economic Association, vol. 86(1), pages 237-258, March.
    13. Haley, Usha C.V. & Haley, George T., 2013. "Subsidies to Chinese Industry: State Capitalism, Business Strategy, and Trade Policy," OUP Catalogue, Oxford University Press, number 9780199773749.
    Full references (including those not matched with items on IDEAS)

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:red:sed015:1247. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christian Zimmermann). General contact details of provider: http://edirc.repec.org/data/sedddea.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.