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Did government R&D subsidies increase Chinese firms’ trade margins? Evidence from Innofund program

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  • Chengfeng Chen
  • Peiyuan Xu

Abstract

This study investigates the effects of government R&D subsidies on firms’ trade margins using a panel dataset for Chinese manufacturing firms during the period between 2001 ndto 2014. This study finds that an R&D subsidy increases Chinese firms’ propensity to begin exporting and increases existing exporters’ sales from export (across-firm trade margins). After disentangling firms’ export value at the product-country transaction level, this study further finds that government R&D subsidy increases firms’ both intensive margin and extensive margin (within-firm trade margins).

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  • Chengfeng Chen & Peiyuan Xu, 2021. "Did government R&D subsidies increase Chinese firms’ trade margins? Evidence from Innofund program," Applied Economics Letters, Taylor & Francis Journals, vol. 28(5), pages 397-401, March.
    • Handle: RePEc:taf:apeclt:v:28:y:2021:i:5:p:397-401
    DOI: 10.1080/13504851.2020.1757608
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