The Influence Of Government Subsidies On Industry Concentration And Total Factor Productivity

As an important means for the government to implement industrial policies,government subsidies have been widely concerned.The government subsidy refers to the free fund transfer provided by the government to the microeconomic subject for a specific purpose in a certain period.As Xi Jinping pointed out,"Accelerating the development of strategic emerging industries is not only a key measure to promote China’s economic growth and sustainable development,but also a major strategic choice to build China into a modern power and respond to global changes and challenges." At present,China’s economic development has entered a new normal,fostering strategic emerging industries is of great significance to transform China’s economic development model,promote the transformation and upgrading of industrial structure,and enhance China’s independent research and development ability and international competitiveness.It is reasonable for the government to give subsidies to enterprises,but in the actual implementation process of government subsidies,the effect of policy implementation is not obvious,but also produces great pressure on government finance.Faced with limited financial resources and increasingly fierce market competition,the government urgently needs to improve the subsidy scheme and improve the efficiency of enterprises’ use of subsidies.Based on the analysis of existing literature,this thesis takes government subsidies in strategic emerging industries as the research object.On the one hand,it examines the impact of government subsidies on industry concentration from the industry level,and on the other hand,it examines the impact of government subsidies on enterprise total factor productivity from the enterprise level.Industry concentration measure the market structure,for the study of enterprise behavior and market performance,in antitrust practice to provide a reference standard is of great significance.Total factor productivity is one of the indicators of productivity,reflecting all the relevant factors that cannot be explained by input factors,such as the technical level of production and resource allocation efficiency.Improving enterprise total factor productivity is conducive to the healthy development of the industry.Through the combination of theoretical model and empirical analysis,this thesis analyzes and verifies the influence of government subsidies on industry concentration and enterprise total factor productivity,hoping to provide theoretical support and practical inspiration for improving the efficiency of government subsidies for strategic emerging industries and promoting the healthy development of the market.Firstly,the thesis discusses the influence of government subsidies on industry concentration.By constructing theoretical model analysis,found that the government subsidies can change different manufacturer production efficiency of the market share,in turn,affect the industry concentration,and using the HHI index as the measure of industry concentration measurement indicators of strategic emerging industry four digits industry market concentration,and then empirically tested using PCSE model,the results show that government subsidies have a negative effect on industry concentration.Secondly,this thesis discusses the impact of government subsidies on total factor productivity.By building a theoretical model,analyzes how enterprises after receive government subsidies in subsidies will be to make profits and to improve the productivity of the two choices,and new energy vehicles related enterprises,for example,use the LP method measuring the enterprise total factor productivity after empirically using bidirectional fixed model,research shows that the government subsidies to reduce enterprise total factor productivity.From the conclusion of this thesis,the government should reasonably adjust the government subsidies to strategic emerging industries,gradually reduce the input in the process of development,strengthen the industry market competition,form a stable and efficient market structure through the power of the market and promote the marketization of technological innovation.When the government supports the R&D and production of enterprises,different measures can be taken for different enterprises to optimize the industrial environment through subsidies.Finally,strengthen the tracking monitoring subsidies,effective regulation of the concentration degree of the related industry,at the same time also to correctly identify the enterprise behavior,application of subsidies in the specific enterprise channel set up corresponding monitoring system,formulate reasonable scientific subsidies feedback index evaluation standard,to strengthen enterprise subsidies the disclosure of information,achieve reasonable use.