Research On The Impact Of Government Subsidies On Firms’ Export Ternary Margins

Since the reform and opening up,China’s foreign trade has made world-renowned achievements,of which China’s total trade in goods steadily ranked first in the world from 2017-2022.In order to achieve high quality economic development and shape a high level of openness to the outside world,the “14th Five-Year Plan” proposes to build a new development pattern with the domestic circulation as the main body and the domestic and international circulation promoting each other,which puts forward higher requirements for China’s domestic trade and foreign trade,but due to the increase in the number of subsidies worldwide year by year,resulting in more and more countervailing investigations and trade frictions among trading partner countries,the trade environment is deteriorating,which has a negative impact on the exports of Chinese enterprises.In this context,this paper uses resource allocation theory,economies of scale theory,and strategic trade policy theory as the starting point to investigate the relationship between government subsidies,production scale,and the ternary margins of firms’ exports using theoretical models and empirical analysis.This paper uses the combined data of China Industrial Enterprise Database and China Customs Trade Database from 2011-2015 to set whether an enterprise achieves export,the average export value of the enterprise’s products to each country,and the number of export destinations of the enterprise’s products as the ternary margins of firms’ exports,and to investigate the direct effect of government subsidies on the ternary margins of firms’ exports and the mediating role played by production scale in it,taking into account the heterogeneity of enterprise ownership,region and productivity level.The results show that:(1)the direct effects of government subsidies on the ternary margins of firms’ exports are all significantly facilitated;(2)Production size is an effective mediator in the effect of government subsidies on firms’ export ternary margins and plays a negative role,which means,government subsidies promote production scale,but production scale plays a suppressive effect on firms’ export ternary margins;(3)The direct effect of government subsidies on firms’ export ternary margins and the mediating role played by production scale in it differ significantly across ownership,regions and productivity levels of firms.Based on the findings,we recommends: further improving and standardizing government subsidy policies,focusing on cultivating sustainable export capacity of enterprises;implementing differentiated subsidy policies for different types of enterprises to improve subsidy efficiency;strengthening the tracking and monitoring of subsidies,and introducing a more scientific and dynamic adjustment mechanism.