Industrial Policy and Competition

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Management Papers
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industrial policy
competition
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intellectual property policy
patent system
innovation and productivity
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Management Sciences and Quantitative Methods
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Aghion, Philippe
Dewatripont, Mathias
Du, Luosha
Harrison, Ann E
Legros, Patrick
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Abstract

Using a comprehensive dataset of all medium and large enterprises in China between 1998 and 2007, we show that industrial policies allocated to competitive sectors or that foster competition in a sector increase productivity growth. We measure competition using the Lerner Index and include as industrial policies subsidies tax holidays, loans, and tariffs. Measures to foster competition include policies that are more dispersed across firms in a sector or measures that encourage younger and more productive enterprises. (JEL L11, L25, L52, O14, O25, O47, P31)

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2015-10-01
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American Economic Journal: Macroeconomics
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