China’s Industrial Policy: an Empirical Evaluation

Barwick, Panle Jia; Kalouptsidi, Myrto; Zahur, Nahim Bin

doi:10.2139/ssrn.3417181

Cited by 23 publications

(34 citation statements)

References 50 publications

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“…Subsidies to SOEs in China's steel industry may be subject to discipline by the SCM rules. Equation (5) is the same as equation (2) in Table 8…”

Section: Resultsmentioning

confidence: 99%

“…They catalogue the various "anti-competitive practices" of SOEs as (1) predatory pricing, (2) raising rivals' costs, (3) cross-subsidization, and (4) strategic adoptions of inefficient technology. They then discuss the remedies that competitive agencies can take, including (1) ex-post enforcement of competition rules on unilateral conduct, (2) using merger controls to level the playing field, and 3…”

Section: Soe Governance and Competitive Neutralitymentioning

confidence: 99%

“…The other approach is to estimate behavior of related parties, .structural estimation. This type of research is very few: Kalouptisidi (2018), Barwick Kalouptsidi and Zahur(2019) are the exceptions.…”

Section: Introductionmentioning

confidence: 99%

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Competitive Neutrality of State-owned Enterprises in China's Steel Industry: A Causal Inference on the Impacts of Subsidies

Watanabe

2020

SSRN Journal

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This study investigates whether subsidies to state-owned enterprises (SOEs) in China's steel industry are distorting competitive neutrality. The Subsidy and Countervailing Measures Agreement of the World Trade Organizations defines ''specific'' and ''harmful'' subsidies as being subject to discipline, because they distort the allocation of resources. During the recession in the steel industry between 2008 to 2015, China produced excessively and exported aggressively at a lower price. This study hypothesizes that subsidies given by local governments to specific SOEs with undefined conditions softened the budget constraints of these SOEs and that the market equilibrium price would have been lower had no subsidy been provided. Using data from the financial statements of listed steel and iron firms and other relevant sources, I find that firms with operating deficits received subsidies that were large enough to compensate for their deficits. This preferential treatment of these specific SOEs induced them to engage in price cutting behavior, harming competitiveness in the market.

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“…Subsidies to SOEs in China's steel industry may be subject to discipline by the SCM rules. Equation (5) is the same as equation (2) in Table 8…”

Section: Resultsmentioning

confidence: 99%

Section: Soe Governance and Competitive Neutralitymentioning

confidence: 99%

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Competitive Neutrality of State-owned Enterprises in China's Steel Industry: A Causal Inference on the Impacts of Subsidies

Watanabe

2020

SSRN Journal

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“…This decrease in market share corresponded to a loss of CNY 140 billion (USD 21 billion) for the two countries combined. 9 The fast expansion of the Chinese shipbuilding industry also weighed on the EU's shipbuilding industry. In recent years, Chinese shipyards have for instance been able to attract several new build ferry orders, in line with the Chinese objectives of targeting the higher value ship building and marine equipment segments.…”

Section: Global Perspectivementioning

confidence: 99%

Report on China’s shipbuilding industry and policies affecting it

2021

OECD Science, Technology and Industry Policy Papers

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“…An ascending hegemon views trade as a economic model is based on vast subsidies favoring high-tech industries and state-owned companies, price dumping, intellectual property theft, and forced technology transfer of foreign corporations to Chinese companies. Steel mills, solar panel producers, and shipbuilders received discounted loans, low-cost electric power, or investment from the state; these subsidies granted them an unfair advantage vis-à-vis foreign competitors but resulted in a number of disadvantages as well, such as unprofitable "zombie" firms and inefficiency (e.g., Barwick, Kalouptsidi, and Zahur 2019). Despite China's clear violations of the WTO rules of free trade and market economy, previous administrations did not tackle them seriously.…”

Section: American Decline and Trump's Understanding Of Tradementioning

confidence: 99%

Maximum Pressure, Minimum Deal: President Trump’s Trade War with a Rising China*

Janusch¹,

Lorberg²

2020

S+F

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In the context of the American decline, President Trump’s trade war toward a rising China fits into the pattern of a declining hegemon, as predicted by hegemonic stability theory. Trump’s trade policy is driven by his view of trade as a zero-sum game, his fixation on the trade deficit, and his “maximum pressure” negotiation approach. The result - the “phase one” deal - seems to be a trade ceasefire rather than a lasting trade peace between the declining hegemon and its ascending challenger because it stands on a shaky foundation. This “phase one” deal does not address the structural problems in the US-Sino trade relation. Moreover, its goals are unrealistic, and it is built upon a dispute settlement that favors deal determination over rule-based conflict resolution.

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China’s Industrial Policy: an Empirical Evaluation

Cited by 23 publications

References 50 publications

Competitive Neutrality of State-owned Enterprises in China's Steel Industry: A Causal Inference on the Impacts of Subsidies

Competitive Neutrality of State-owned Enterprises in China's Steel Industry: A Causal Inference on the Impacts of Subsidies

Report on China’s shipbuilding industry and policies affecting it

Maximum Pressure, Minimum Deal: President Trump’s Trade War with a Rising China*

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