The Additionality, Displacement and Substitution Effects of Factor Subsidies

Darryl R Holden and John Swales ()

Scottish Journal of Political Economy, 1995, vol. 42, issue 2, 113-26

Abstract: In this paper, a Cournot multifirm oligopolisitc framework is used to analyze the output and employment impacts of selective factor subsidies. Additionality, displacement, and substitution effects are all separately identified. The paper argues that the methods used in existing empirical studies to identify additionality and displacement are likely to be inaccurate and that this is more problematic the more selective the subsidies are. Copyright 1995 by Scottish Economic Society.

Date: 1995
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Persistent link: https://EconPapers.repec.org/RePEc:bla:scotjp:v:42:y:1995:i:2:p:113-26

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