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1 – 10 of over 16000The purpose of this paper is to attempt to expand the traditional economic effect analysis of export subsidy, which has previously ignored the incentive of export subsidies in…
Abstract
Purpose
The purpose of this paper is to attempt to expand the traditional economic effect analysis of export subsidy, which has previously ignored the incentive of export subsidies in terms of competition from re‐importation.
Design/methodology/approach
The paper performs a comparative static analysis based on the traditional welfare analysis of export subsidies by introducing different transportation costs and using small country model and large country model, respectively.
Findings
Compared with the traditional analysis, exporting countries that implement export subsidies suffer less welfare loss and induce intra‐industry trade of homogeneous products. Due to export subsidy policy incentives, transportation costs heavily influence trade patterns, trade volumes and welfare. Trade patterns evolve from unidirectional export to intra‐industry trade as transportation costs are reduced, with the main source of welfare loss coming from transportation costs. The distribution of export subsidies is biased when domestic transportation costs are high. Under low domestic transportation costs, inefficient intra‐industry trade would emerge as a result of export subsidy incentive.
Practical implications
The findings could be helpful to understand the impact of export subsidy policy on trade pattern, trade volumes and welfare when considering international and domestic transportation cost.
Originality/value
The paper emphasizes the incentive of export subsidy on re‐importation, and links it with transportation costs, which expand the traditional export subsidy analysis.
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Hua Du, Qi Han, Jun Sun and Cynthia Changxin Wang
This study aims to evaluate the effectiveness of different prefabricated construction (PC) policies using a case study in Wuhan, considering the local context.
Abstract
Purpose
This study aims to evaluate the effectiveness of different prefabricated construction (PC) policies using a case study in Wuhan, considering the local context.
Design/methodology/approach
The effectiveness of PC policies is falling behind expectations. The main reason lies in an insufficient understanding of the policy impacts. An agent-based model was built by choosing the residential sector in a typical large city of Wuhan, China, as the study case. Different cost reduction scenarios were introduced for investigating the PC policy effectiveness. The proposed model and simulation approach can be used for other cities and generalized to the whole Chinese PC industry with the potential to include more local policies and corresponding data.
Findings
Simulation results show that carbon emission reduction will be between 60,000 and 80,000 tons with policy incentives, nearly double that of the no policy intervention scenario. The target of 30% PC in all new buildings by 2026 in China is achievable with the subsidy policies of linear cost reduction, or cost reduction conforms to the learning curve.
Practical implications
Simulation results of three kinds of policy show that subsidy policy optimization is necessary regarding reducing the level of subsidy needed. The carbon credit policy is not essential since it has little influence on PC development. Implementing the project procurement restriction policy is not recommended if the scale of development of PC is more important than achieving the development target.
Originality/value
This study can help the government and developers make better policy and strategic decisions on PC development and boost the sustainability transition of the construction industry.
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It is widely accepted that next‐generation infrastructures will improve economic growth and employment. However, the cost of such a roll‐out is high and profitability is…
Abstract
Purpose
It is widely accepted that next‐generation infrastructures will improve economic growth and employment. However, the cost of such a roll‐out is high and profitability is uncertain. Therefore operators hesitate to invest massively. In such a context, public intervention could help rollout. Several forms of intervention are possible. This paper aims to study, more specifically, subsidy strategies: subsidising demand by a contribution to each household's subscription fee for a pre‐determined time (a refund, a tax cut) or subsidising infrastructure by means of a contribution to operators' infrastructure costs.
Design/methodology/approach
The paper uses a dynamic mathematical model based on industrial organization and numerical examples based on techno‐economic analysis.
Findings
This paper shows that subsidising demand is more efficient, in welfare terms, than infrastructure subsidies as long as the time required for private operators to cover an area, without subsidies, is shorter than the duration of the subsidies required to cover the same area immediately, thanks to the increase in consumers' willingness to pay.
Social implications
This paper can help policy makers to optimise public investments in the next‐generation infrastructure.
Originality/value
This paper highlights the leverage that subsidies can provide to infrastructure roll‐out in a dynamic point of view.
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Deana Grobe, Roberta B. Weber, Elizabeth E. Davis and Ellen K. Scott
Purpose – This study examines parents’ financial stress associated with obtaining care for young children while employed in unstable low-wage jobs. The child care subsidy program…
Abstract
Purpose – This study examines parents’ financial stress associated with obtaining care for young children while employed in unstable low-wage jobs. The child care subsidy program aims to both improve child care quality and support employment, and we expect that a substantial infusion of resources into this program would reduce parents’ financial stress.
Methodology/approach – We use a mixed-methods research design to study parents’ financial costs of child care, how predictable the cost of child care is to a parent, and what strategies parents employ to manage child care costs.
Findings – We find that parents perceive the subsidy program essential to their ability to manage the needs of their children and working. Yet, receiving subsidies does not appear to alleviate parents’ financial stress because child care costs continue to consume a large share of the family's income and subsidy policies make it difficult for parents to predict their portion of the costs. Parents manage the large and unpredictable expense of child care by decreasing other expenditures and increasing debt.
Practical implications – Changing subsidy policies so they better fit the reality of these families’ lives could result in a more substantive stress reduction. States can reduce unpredictability by reducing and stabilizing participants’ child care cost burden and revising eligibility policy.
Originality/value of paper – This research project fills an important gap in our knowledge about financial stress of low-income working families, provides insights into the role subsidy program participation plays in these parents’ lives, and informs discussion of subsidy policy.
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Zhenfeng Liu, Yujie Wang and Jian Feng
This paper aims to study vehicle-type strategies for the manufacturer's car sharing by accounting for consumers' behavior and the subsidy.
Abstract
Purpose
This paper aims to study vehicle-type strategies for the manufacturer's car sharing by accounting for consumers' behavior and the subsidy.
Design/methodology/approach
The authors develop a game model, in which a monopoly manufacturer that can produce gasoline vehicles (GVs) or energy vehicles (EVs) not only sells vehicles in the sales market, but also rents them out in the sharing market by the self-built platform. The manufacturer strategically chooses which type of vehicles based on consumers' behavior and whether the government provides the EVs’ subsidy.
Findings
When consumers' low-carbon awareness is relatively high or the marginal cost is low, the manufacturer chooses EVs. The manufacturer chooses GVs when the low-carbon awareness and the marginal cost are low. Only when the low-carbon awareness and the subsidy are not too low, the manufacturer who originally chose GVs launches EVs. When the low-carbon awareness is high, the excessive subsidy discourages the manufacturer from entering the sharing market. If the government provides the subsidy, the manufacturer launches high-end EVs. Otherwise, the manufacturer launches low-end EVs. Moreover, the subsidy increases consumer surplus and social welfare since the high subsidy makes EVs’ sharing market demand be negative.
Originality/value
This study enriches the literature on vehicle-type strategies for the manufacturer's car sharing, owns a practical significance to guide the manufacturer's operation management in the car sharing market and provides advice on whether the government should provide EVs’ subsidy.
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This paper aims to examine the effects of marginal and general wage subsidies on employment and income distribution.
Abstract
Purpose
This paper aims to examine the effects of marginal and general wage subsidies on employment and income distribution.
Design/methodology/approach
The paper constructs a theoretical, partial‐equilibrium model of an economy in which a large number of competitive firms produce a homogeneous output good. Involuntary unemployment arises from a too high and rigid wage. By conducting comparative static analyses, the paper evaluates the impact of general and marginal wage subsidies on employment and incomes.
Findings
The paper shows that a marginal wage subsidy is a fiscally more efficient instrument for employment creation than a general wage subsidy because it resembles a combination of a general wage subsidy with a profit tax. These favorable effects persist even if between‐firm displacement effects are taken into account.
Research limitations/implications
In line with most of the literature on marginal employment subsidies, attention is restricted to a partial‐equilibrium analysis in which the wage is assumed to be fixed. This helps to sharpen the focus on between‐firm competition, but is perhaps implausible when analyzing a general‐equilibrium setting. The inclusion of endogenous wage setting is bound to provide an interesting area for future research.
Practical implications
If politicians want to implement a wage subsidy scheme that has to be self‐financing, marginal wage subsidies are an effective policy instrument for employment creation. Its downside is an inefficient allocation of labor among firms, because some firms become larger than is necessary.
Originality/value
The paper provides a novel approach to model the between‐firm displacement effects of marginal wage subsidies and derives policy conclusions.
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Huang Chunyan, Zhong Funing and He Jun
The purpose of this paper is to analyze and compare the costs of price and income subsidies when the food security policy targets the urban poor. The result may help policymakers…
Abstract
Purpose
The purpose of this paper is to analyze and compare the costs of price and income subsidies when the food security policy targets the urban poor. The result may help policymakers choose a desired subsidy scheme to ensure food security for the urban poor facing food price surge.
Design/methodology/approach
The analysis consists of three parts: constructing an empirical model on provincial panel data in 1993‐2009 estimating the impact of grain price on food security among urban residents by different income level; evaluating the potential costs of shifting to income subsidy aiming to maintain the real income levels of the low income, lowest income or the poor residents if grain price increases by 20 percent; and comparing with the cost of price subsidy to achieve the same policy goal.
Findings
The paper finds that, food price surge will hurt the urban poor much more seriously than the high income population; the rich residents may receive more benefit from price subsidy; and income subsidy has obviously a cost advantage while the targeted people benefit more.
Originality/value
The obvious value of the paper is to show that income subsidy is much more desired than price subsidy, if the policy goal is to help the poor during food price surge.
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Christopher N. Boyer and Andrew P. Griffith
Livestock Risk Protection (LRP) insurance can reduce losses from price declines for cattle producers, but LRP adoptions has been limited. In 2019 and 2020, LRP subsidies were…
Abstract
Purpose
Livestock Risk Protection (LRP) insurance can reduce losses from price declines for cattle producers, but LRP adoptions has been limited. In 2019 and 2020, LRP subsidies were increased to lower the cost, but it is unclear how much these changes lowered the cost. The objective of this research was to estimate the impact of the subsidy increase on the cost of LRP for feeder and fed cattle by month and for various insurance period lengths and levels.
Design/methodology/approach
The authors collected United States LRP offering data from 2017 to 2021. The authors estimated separate generalized least squares regression for feeder cattle and fed cattle with producer premium as the dependent variable. Independent variables were dummy variables for coverage level, insurance period, month and year as well as dummy variables in commodity years 2019 and 2020 when the LRP subsidy was increased.
Findings
The authors found the subsidy increases did reduce the cost of LRP policies for feeder and fed cattle LRP policies. Producer premiums for feeder cattle LRP polices have declined between $1.41 to $1.90 per cwt and $0.95 to $1.56 per cwt for fed cattle LRP policies depending on the coverage level. Results indicate these subsidy increases did lower the LRP premium costs to producers.
Originality/value
Results show policy implications from the subsidy increases and will be informative to producers when exploring the cost of LRP. This study extends the literature by estimating the reduction in subsidy costs while considering total premiums changed.
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Peiqi Ding, Zhiying Zhao and Xiang Li
The power battery is the core of a new energy vehicle and plays a vital role in the rise of the new energy vehicle industry. As the number of waste batteries increases, firms…
Abstract
Purpose
The power battery is the core of a new energy vehicle and plays a vital role in the rise of the new energy vehicle industry. As the number of waste batteries increases, firms involved in the industry need to properly dispose them, but what party is responsible remains unclear. To reduce environmental impacts, governments introduce two subsidy policies, i.e. collection subsidies, which are provided to the collecting firms, and dismantling subsidies, which are provided to the dismantling firms.
Design/methodology/approach
Based on the different characteristics of the subsidies, we develop a stylized model to examine the collection strategies and the preferences over the subsidies.
Findings
We derive several insights from analysis. First, the collection strategies depend on the fixed collection cost. Second, the key factor determining the firm's subsidy preference is the efficiency of dismantling. Finally, if the primary target is the collection rate, governments prefer to provide collection subsidies. If consider the environmental impact, the choice of subsidies has to do with the efficiency of dismantling. Moreover, from a social welfare perspective, the raw material cost and the efficiency of dismantling are core indicators of decision.
Originality/value
This work develops the first analytical model to study two power battery subsidies and investigate the optimal collecting strategies and subsidy preferences. The insights are compelling not only for the manufacturer and the third party but also for policymakers.
Peer review
The peer review history for this article is available at: https://publons.com/publon/10.1108/IMDS-08-2019-0450
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Yong Liu, Wenwen Ren, Qian Xu and Zhiyang Liu
This paper aims to deal with the coordination problem of the supply chain through cost sharing of corporate social responsibility (CSR) and government subsidy.
Abstract
Purpose
This paper aims to deal with the coordination problem of the supply chain through cost sharing of corporate social responsibility (CSR) and government subsidy.
Design/methodology/approach
With respect to the coordination problem of the supply chain with CSR, this paper constructs a three-stage game model consisting of a dominant retailer, n suppliers and government. From the perspective of cost sharing and government subsidies, this paper discussed the decentralized and centralized decision-making, respectively. On this basis, this paper designed a coordination mechanism considering both cost sharing and government subsidies and explore the impact of cost sharing rate and government subsidy rate on CSR efforts, members’ profits and social welfare.
Findings
CSR can improve the profits of supply chain members and the overall performance of the supply chain. Then the profits of supply chain nodal enterprises will be affected by the fulfillment level of CSR of their partners. Furthermore, excessive CSR will erode the supply chain profits and cause resource waste. High CSR costs often make retailers low CSR effort level, while a high CSR cost sharing rate can reduce the profits of suppliers and the supply chain. In addition, excessive government subsidies will lead to the decline of social welfare. Excessive government subsidies will cause the dependence of enterprises and affect their operating efficiency.
Practical implications
The proposed coordination mechanism can effectively do with the coordination problem of the supply chain.
Originality/value
The proposed coordination mechanism considering cost sharing and government subsidies simultaneously can effectively deal with conflict problems and guarantee the supply chain members and the supply chain to maximize their profits and social welfare.
Details