China's Exports, Subsidies To State Owned Enterprises and the WTO

Eckaus, Richard S.

doi:10.2139/ssrn.611941

Cited by 11 publications

(15 citation statements)

References 7 publications

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“…This explores the impact of China's particular policy of granting subsidies to loss making SOEs which were an issue during WTO negotiations (Eckaus, 2006). Our results…”

Section: Econometric Resultsmentioning

confidence: 94%

“…In order to allow for a simple Eckaus (2006) is highly sceptical of this argument, but there is a certain justification behind it. First, local government has rather great freedom in offering money and favorable policies to firms that are located in their regions.…”

Section: Theoretical Illustration and Empirical Approachmentioning

confidence: 99%

“…Rather it is more likely that governments select targets for subsidising based on certain firm characteristics which are systematically correlated with exporting. For example, Eckaus (2006) discusses Chinese policies of subsidising loss making SOEs, and a firm's profit or productivity performance is likely to be correlated with its exporting status. In our analysis we take particular account of the potential endogeneity of production subsidies using an instrumental variables Tobit estimator due to Blundell and Smith (1986).…”

Section: Introductionmentioning

confidence: 99%

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Can Production Subsidies Foster Export Activity? Evidence from Chinese Firm Level Data

et al. 2006

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“…This explores the impact of China's particular policy of granting subsidies to loss making SOEs which were an issue during WTO negotiations (Eckaus, 2006). Our results…”

Section: Econometric Resultsmentioning

confidence: 94%

Section: Theoretical Illustration and Empirical Approachmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

Can Production Subsidies Foster Export Activity? Evidence from Chinese Firm Level Data

et al. 2006

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“…The share of the subsidies to loss-making SOEs in China's government expenditures declined from a high of 25 percent in 1985 to about two percent in 2000. Subsidies to loss-making SOEs alone were 2.6 percent of the total profits of all SOEs in 2001, and were larger in previous years (Eckaus 2006). Besides the direct budgetary subsidies, China's government allowed many loss-making SOEs to stay in business and this resulted in the accumulation of a large portfolio of non-performing loans at state banks.…”

Section: Overview Of China's Soe Subsidiesmentioning

confidence: 99%

The State-Owned Enterprises Issue in China’s Prospective Trade Negotiations

Chen¹,

Whalley²

2017

The Economies of China and India

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China, in the next few years, faces the prospect of major regional and bilateral trade negotiations possibly including the Trans-Pacific Partnership (TPP), the Regional Comprehensive Economic Partnership with the Association of Southeast Asian Nations (ASEAN) and Japan, Korea, India, Australia and New Zealand and separate negotiations with India, Korea and Japan, potentially the United States and even possibly the European Union. A likely key element in such negotiations, and one already raised by the United States in the TPP negotiations, 1 is that of trade arrangements involving state-owned enterprises (SOEs). China is viewed from outside as having a large SOE sector, and large SOEs are viewed as having a protected monopoly position in domestic Chinese markets. This paper discusses some of the key sub-issues potentially arising with SOEs in these negotiations. These include: arrangements for SOEs under China's antitrust laws as well as the operation of these arrangements in practice via case law, and how trade is affected by them; the potentially large increase in Chinese coverage of the World Trade Organization (WTO) government procurement code if Chinese SOEs were to be included under it; the implications of the changing relative size of SOEs and private sectors in China for the "non-market" economy (NME) designation, which China consented to upon WTO accession; and claimed subsidization of SOEs through various devices. These issues arise prominently in the Chinese case, but are similar to SOE issues in other negotiations, including in the emerging US-EU Transatlantic Trade and Investment Partnership negotiation. Reference will thus be made to similar issues and precedents elsewhere. The aim is to lay out a potential negotiating issues list for SOEs to better focus debate and outline possible approaches to accommodation, rather than definitively resolve the issues.

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“…First, China offers an ideal setting to investigate the impact of the ETR on firms' exports. On the one hand, it has experienced spectacular growth in international trade since the 1980s (Wang & Wei, ), it annually exports the largest volume of products in the world (Lin, ), and its outstanding trade growth has attracted considerable attention because of the trade policies implemented by the Chinese government (e.g., Eckaus, ; Girma, Gong, Gorg, & Yu, ). On the other hand, the Chinese government frequently changes the ETR rates to adjust its exports.…”

Section: Introductionmentioning

confidence: 99%

Regional effects of export tax rebate on exporting firms: Evidence from China

Tan

2017

Rev International Economics

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This paper extends a model from 2003 to separate the direct and indirect impact of an export tax rebate on the intensive margin of firm‐level export sales at the subnational level. The direct impact of the rebate is associated with a reduction of an exporting firm's variable costs, while the indirect impact manifests itself through higher regional wages as a result of increased demand for local labor. First, the empirical results imply that a 1 percent rise in the export tax rebate rate increases the export sales among continuing exporters by 0.2 percent through the direct channel. Second, through the indirect channel, a 1 percent difference in the regional rebate causes a 0.02 percent difference in exporters' sales growth. Both effects are statistically significant, and are consistent with the model's predictions.

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China's Exports, Subsidies To State Owned Enterprises and the WTO

Abstract: ABSTRACT

Cited by 11 publications

References 7 publications

Can Production Subsidies Foster Export Activity? Evidence from Chinese Firm Level Data

Can Production Subsidies Foster Export Activity? Evidence from Chinese Firm Level Data

The State-Owned Enterprises Issue in China’s Prospective Trade Negotiations

Regional effects of export tax rebate on exporting firms: Evidence from China

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