Li, S. and Harris, R. (2016) 'Government assistance and total factor productivity : firm-level evidence from China, 1998-2007.', Working Paper. Durham University Business School, Durham.
The provision of large-scale assistance to industry is very important in China. The major contribution of this paper is to use Chinese firm-level panel data for 1998-2007 to introduce measures of assistance received by each firm directly into industry-level production functions determining firm output. Our results indicate inverted U-shaped gains from assistance: across the 26 industries considered, firms receiving assistance rates of 1-10%, 10-19%, 20-49% and 50+% experienced on average 4.5%, 9.4%, 9.2% and -3% gains in TFP, respectively. We also provide a simple agency model that justifies such a result.
|Item Type:||Monograph (Working Paper)|
|Additional Information:||CEGAP Working Papers, No 2016_04|
|Full text:||(VoR) Version of Record|
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|Publisher Web site:||http://EconPapers.repec.org/RePEc:dur:cegapw:2016_04|
|Date accepted:||No date available|
|Date deposited:||21 September 2016|
|Date of first online publication:||September 2016|
|Date first made open access:||No date available|
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