IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/31008.html
   My bibliography  Save this paper

Input Subsidies and the Destruction of Natural Capital: Chinese Distant Water Fishing

Author

Listed:
  • Gabriel Englander
  • Jihua Zhang
  • Juan Carlos Villaseñor-Derbez
  • Qutu Jiang
  • Mingzhao Hu
  • Olivier Deschenes
  • Christopher Costello

Abstract

Input subsidies in natural resource sectors are widely believed to cause depletion of the natural capital on which those sectors rely. But identification and data challenges have stymied attempts to empirically estimate the causal effect of subsidies on resource extraction. China’s fishing fleet is the world’s largest, and in 2016 the government changed its fuel subsidy policy for distant water vessels to one that increases with predetermined vessel characteristics. The policy features 25 thresholds at which subsidies discontinuously increase. Using a regression discontinuity design, we estimate that a 1% increase in fuel subsidy increases hours of fishing by 2.2%. Reducing Chinese distant water fuel subsidies by 50% could eliminate biological overfishing in several ocean regions.

Suggested Citation

  • Gabriel Englander & Jihua Zhang & Juan Carlos Villaseñor-Derbez & Qutu Jiang & Mingzhao Hu & Olivier Deschenes & Christopher Costello, 2023. "Input Subsidies and the Destruction of Natural Capital: Chinese Distant Water Fishing," NBER Working Papers 31008, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:31008
    Note: EEE
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w31008.pdf
    Download Restriction: no
    ---><---

    More about this item

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:31008. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.