The determinants and effectiveness of industrial policy in china: A study based on Five-Year Plans

Yiyun Wu; Xiwei Zhu; Nicolaas Groenewold

doi:10.1016/j.chieco.2018.09.010

The determinants and effectiveness of industrial policy in china: A study based on Five-Year Plans

Yiyun Wu, Xiwei Zhu, Nicolaas Groenewold

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Abstract

This paper examines industrial policy in China over the period of the 9th-12th Five-Year Plans (FYPs). Based on China's national and provincial FYPs and data disaggregated to the four-digit manufacturing sector level, it finds that the central government's preferences act as a key determinant of the provincial FYPs. It also shows that policy significantly improves output while it is in effect but there is no evidence of a beneficial effect beyond the end of the particular FYP. The results are consistently robust across a number of tests.

Original language	English
Pages (from-to)	225-242
Number of pages	18
Journal	China Economic Review
Volume	53
DOIs	https://doi.org/10.1016/j.chieco.2018.09.010
Publication status	Published - Feb 2019

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10.1016/j.chieco.2018.09.010

Cite this

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title = "The determinants and effectiveness of industrial policy in china: A study based on Five-Year Plans",

abstract = "This paper examines industrial policy in China over the period of the 9th-12th Five-Year Plans (FYPs). Based on China's national and provincial FYPs and data disaggregated to the four-digit manufacturing sector level, it finds that the central government's preferences act as a key determinant of the provincial FYPs. It also shows that policy significantly improves output while it is in effect but there is no evidence of a beneficial effect beyond the end of the particular FYP. The results are consistently robust across a number of tests.",

keywords = "Industrial policy, Industry selection, Five-Year Plan, PROPENSITY SCORE, EMPIRICAL-TEST, INVESTMENT, LOCATION, IMPACT, TRADE",

author = "Yiyun Wu and Xiwei Zhu and Nicolaas Groenewold",

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T2 - A study based on Five-Year Plans

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AU - Zhu, Xiwei

AU - Groenewold, Nicolaas

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N2 - This paper examines industrial policy in China over the period of the 9th-12th Five-Year Plans (FYPs). Based on China's national and provincial FYPs and data disaggregated to the four-digit manufacturing sector level, it finds that the central government's preferences act as a key determinant of the provincial FYPs. It also shows that policy significantly improves output while it is in effect but there is no evidence of a beneficial effect beyond the end of the particular FYP. The results are consistently robust across a number of tests.

AB - This paper examines industrial policy in China over the period of the 9th-12th Five-Year Plans (FYPs). Based on China's national and provincial FYPs and data disaggregated to the four-digit manufacturing sector level, it finds that the central government's preferences act as a key determinant of the provincial FYPs. It also shows that policy significantly improves output while it is in effect but there is no evidence of a beneficial effect beyond the end of the particular FYP. The results are consistently robust across a number of tests.

KW - Industrial policy

KW - Industry selection

KW - Five-Year Plan

KW - PROPENSITY SCORE

KW - EMPIRICAL-TEST

KW - INVESTMENT

KW - LOCATION

KW - IMPACT

KW - TRADE

U2 - 10.1016/j.chieco.2018.09.010

DO - 10.1016/j.chieco.2018.09.010

M3 - Article

VL - 53

SP - 225

EP - 242

JO - China Economic Review (Amsterdam)

JF - China Economic Review (Amsterdam)

SN - 1043-951X

ER -