China's Pure Exporter Subsidies

Fabrice Defever and Alejandro Riaño

No 121, FIW Working Paper series from FIW

Abstract: One third of Chinese exporters sell more than ninety percent of their production abroad. We argue that this distinctive pattern is attributable to the widespread use of subsidies that require firms to export the vast majority of their output. We study this type of subsidy in the context of a heterogeneous-firm model, and show that it is worse from a welfare standpoint than a regular export subsidy, partly because it increases protection of the domestic market. A counterfactual analysis suggests that eliminating these subsidies would result in a welfare gain for China comparable to that of halving its trade costs.

Keywords: Trade Policy; Export Subsidies; Heterogeneous Firms; China (search for similar items in EconPapers)
JEL-codes: F12 F13 O47 (search for similar items in EconPapers)
Pages: 42
Date: 2013-04
New Economics Papers: this item is included in nep-dev, nep-int and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.fiw.ac.at/fileadmin/Documents/Publikati ... 121-DefeverRiano.pdf full text
none

Related works:
Working Paper: China's Pure Exporter Subsidies (2012)
Working Paper: China's Pure Exporter Subsidies (2012)
Working Paper: China's pure exporter subsidies (2012)
Working Paper: China's Pure Exporter Subsidies (2012)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wsr:wpaper:y:2013:i:121

Ordering information: This working paper can be ordered from
FIW Project Office Austrian Institute of Economic Research Arsenal Objekt 20 A-1030 Vienna

Access Statistics for this paper

More papers in FIW Working Paper series from FIW
Bibliographic data for series maintained by ().