Subsidies, Spillovers and WTO Rules in a Value-chain World

The Economics of WTO Rules on Subsidies and Countervailing Measures

R&D Subsidies, Spillovers and Privatization in Mixed Markets

We examine the use of subsidies to R&D in a mixed and a private duopoly market. We show that the socially optimal R&D subsidy is increasing in the degree of spillovers but it is lower in the private duopoly. The optimal R&D subsidy leads to an increase in total R&D and production, however, it does not lead to the equalisation of per …rm output and therefore to an e¢ cient distribution of produc...

Output Price Subsidies in a Stochastic World

This article studies the comparative statics of output subsidies for firms, with monotonic preferences over costs and returns, that face price and production uncertainty. The modeling of deficiency payments, support-price schemes, and stochastic supply shifts in a state-space framework is discussed. It is shown how these notions can be used, via a simple application of Shephard’s lemma, to anal...

Export Taxes, Industrial Policy and the Value Chain in China After WTO

Countries have long used import tari↵s as an instrument to stimulate or protect downstream industries; however, in the GATT/WTO era, tari↵s have fallen greatly worldwide. Has the WTO succeeded in limiting the prevalence of this class of industrial policy, or are governments still attempting to move downstream via other policy instruments? For countries with large raw materials endowments, one a...

The Value of Knowledge Spillovers

This paper aims at quantifying the economic value of knowledge spillovers by exploring information contained in patent citations. We estimate a market valuation equation for semiconductor firms during the 1980s and 1990s, and find an average value in the amount of $0.6 to 1.2 million “R&D-equivalent” dollars for the knowledge spillovers as embodied in one patent citation. For an average semicon...