R&D subsidy policy of domestic firm considering foreign firm competition

Taking the advanced technology of the foreign firm into account, a mixed duopoly three-stage game model is established in the context of research and development（RD）investment subsidies and product subsidies for domestic firms provided by the government, and the RD subsidy policy of domestic firms in competition with foreign firms is analyzed.The equilibrium output, RD investment of the domestic firm, social welfare and the value of government subsidies are derived, in the case of the two policies, RD investment subsidies and product subsidies for domestic firms, provided by the government. The results show that, the equilibrium output and the optimal social welfare under the RD investment subsidy policy are both less than those under the product subsidy policy; the optimal RD investment under the RD investment subsidy policy is less than that under the product subsidy policy; and the RD product subsidy has a more obvious incentive effect on firm RD investment. Under the background of the leading edge of technology of foreign firms, the product subsidy policy drawn up by the government to encourage RD innovation of domestic firms is more effective than the RD investment subsidy policy.

Analysis of the System of Direct Subsidy for Grain Production in China

This paper introduces the status quo of the system structure of direct subsidy for grain production in China,and analyses the function and essence of direct subsidy for grain production in China as follows:the function of direct subsidy for grain production in China is to protect and promote the development of food industry,ensure food supply and national food security,protect grain growers' interests,and maintain the dominant position of national food trade;the essence of direct subsidy for grain production is the compensation for grain producers' reasonable interests,the compensation for positive externality of grain production,and social costs of adjusting equilibrium between food supply and demand.We discuss the problems existing in the system of direct subsidy for grain production in China and put forward corresponding countermeasures as follows:first,adhere to improving synergetic system of direct subsidy for grain production;second,adjust the direct subsidy method of grain production;third,establish long-term mechanism of subsidy for grain production;fourth,promote the information-based service level of the system of direct subsidy for grain production.

Study on Cleaner Production Subsidies, Income Distribution Imbalance and Carbon Emissions Permit Reallocation Mechanism

The allocation mechanism for carbon emissions permit(CEP)is an institutional guarantee for advancing the development of China’s unified carbon trading market.The initial allocation of carbon quotas fails to solve new inequalities stemming from subsidizing cleaner production.This paper constructs a theoretical framework that describes China’s progressive decline in carbon intensity,calculates the equilibrium solution on the neoclassical saddle point path using the shooting method,and studies the income distribution imbalance caused by cleaner production subsidies and the reallocation mechanism of carbon emissions permit The main conclusion is that the incremental cleaner production subsidy policy meets the goal of maximizing welfare on the saddle point path,but it may lead to over-investment in the clean sector,thus causing the income distribution imbalance among entities.Further research suggests that the amount of carbon emissions permit acquired by the clean sector should be higher than the actual emissions in the trading market and that,as the cleaner support increases,the share of carbon emissions permit acquired by the sector should be constantly increased through reallocation mechanism.This helps achieve the Pareto improvement in all parties’economic benefi ts.