Industrial Policy Module

This is a course webpage for Dr. Zhou Chen’s Industrial Policy module.

Lecture Topics

The main lecture each week will consist of a one-and-a-half-hour session. These lectures will usually cover four topics as follows:

  1. Concepts and Practices: slides
  2. Theoretical Justification: slides
  3. Infant-Industry Protection and Trade: slides
  4. Foreign Direct Investment: slides

Reading List

  1. Juhasz, R., Lane, N., Oehlsen, E., & Pérez, V. C. (2022). The Who, What, When, and How of Industrial Policy: A Text-Based Approach. OSF. https://doi.org/10.31235/osf.io/uyxh9
  2. Juhász, R., Lane, N. J., & Rodrik, D. (2023). The New Economics of Industrial Policy (Working Paper 31538). National Bureau of Economic Research. https://doi.org/10.3386/w31538
  3. Cen, X., Fos, V., & Jiang, W. (2024). How Do U.S. Firms Withstand Foreign Industrial Policies? (Working Paper 32411). National Bureau of Economic Research. https://doi.org/10.3386/w32411
  4. Ding, J., Jiang, L., Msall, L., & Notowidigdo, M. J. (2024). Consumer-Financed Fiscal Stimulus: Evidence from Digital Coupons in China (Working Paper 32376). National Bureau of Economic Research. https://doi.org/10.3386/w32376
  5. Cai, J., & Szeidl, A. (2022). Indirect Effects of Access to Finance (Working Paper 29813). National Bureau of Economic Research. https://doi.org/10.3386/w29813
  6. Liu, Y., & Mao, J. (2019). How Do Tax Incentives Affect Investment and Productivity? Firm-Level Evidence from China. American Economic Journal: Economic Policy, 11(3), 261–291. https://doi.org/10.1257/pol.20170478
  7. Barteska, P., & Lee, J. E. (2023). Bureaucrats and the Korean Export Miracle [Job Market Paper].
  8. Juhász, R., & Steinwender, C. (2023). Industrial Policy and the Great Divergence (Working Paper 31736). National Bureau of Economic Research. https://doi.org/10.3386/w31736
  9. Lu, F., Sun, W., & Wu, J. (2023). Special Economic Zones and Human Capital Investment: 30 Years of Evidence from China. American Economic Journal: Economic Policy, 15(3), 35–64. https://doi.org/10.1257/pol.20200492
  10. Wang, S., & Yang, D. Y. (2021). Policy Experimentation in China: The Political Economy of Policy Learning (Working Paper 29402). National Bureau of Economic Research. https://doi.org/10.3386/w29402
  11. Gross, D. P., & Sampat, B. N. (2023). America, Jump-Started: World War II R&D and the Takeoff of the US Innovation System. American Economic Review, 113(12), 3323–3356. https://doi.org/10.1257/aer.20221365
  12. Lashkaripour, A., & Lugovskyy, V. (2023). Profits, Scale Economies, and the Gains from Trade and Industrial Policy. American Economic Review, 113(10), 2759–2808. https://doi.org/10.1257/aer.20210419
  13. Atalay, E., Hortaçsu, A., Runyun, M., Syverson, C., & Ulu, M. F. (2023). Micro- and Macroeconomic Impacts of a Place-Based Industrial Policy (Working Paper 31293). National Bureau of Economic Research. https://doi.org/10.3386/w31293
  14. Mao, J., Tang, S., Xiao, Z., & Zhi, Q. (2021). Industrial policy intensity, technological change, and productivity growth: Evidence from China. Research Policy, 50(7), 104287. https://doi.org/10.1016/j.respol.2021.104287
  15. Lu, Y., Wang, J., & Zhu, L. (2019). Place-Based Policies, Creation, and Agglomeration Economies: Evidence from China’s Economic Zone Program. American Economic Journal: Economic Policy, 11(3), 325–360. https://doi.org/10.1257/pol.20160272
  16. Howell, S. T. (2018). Joint ventures and technology adoption: A Chinese industrial policy that backfired. Research Policy, 47(8), 1448–1462. https://doi.org/10.1016/j.respol.2018.04.021
  17. Lerner, J., Liu, J., Moscona, J., & Yang, D. Y. (2024). Appropriate Entrepreneurship? The Rise of China and the Developing World (Working Paper 32193). National Bureau of Economic Research. https://doi.org/10.3386/w32193
  18. Tao, P., Gong, F., & Zhu, K. (2023). Tax competition among local governments: Evidence from the spillovers of location-based tax incentives in China. China Economic Review, 82, 102077. https://doi.org/10.1016/j.chieco.2023.102077
  19. Chen, C.-W., Hu, W.-M., & Knittel, C. R. (2021). Subsidizing Fuel-Efficient Cars: Evidence from China’s Automobile Industry. American Economic Journal: Economic Policy, 13(4), 152–184. https://doi.org/10.1257/pol.20170098
  20. Baldwin, R. E. (1969). The Case against Infant Industry Tariff Protection. Journal of Political Economy, 77(3), 295–305.
  21. Krueger, A. O. (1990). Government Failures in Development. The Journal of Economic Perspectives, 4(3), 9–23.
  22. Krueger, A. O., & Tuncer, B. (1982). An Empirical Test of the Infant Industry Argument. American Economic Review, 72(5), 1142–1152.
  23. Harrison, A. E. (1994). An empirical test of the infant industry argument: Reply. American Economic Review, 84(4), 1096.
  24. Levitt, S. D., List, J. A., & Syverson, C. (2013). Toward an Understanding of Learning by Doing: Evidence from an Automobile Assembly Plant. Journal of Political Economy, 121(4), 643–681.
  25. Thornton, R. A., & Thompson, P. (2001). Learning from Experience and Learning from Others: An Exploration of Learning and Spillovers in Wartime Shipbuilding. American Economic Review, 91(5), 1350–1368.
  26. Javorcik, B. S. (2004). Does foreign direct investment increase the productivity of domestic firms? In search of spillovers through backward linkages. The American Economic Review, 94(3), 605–627.
  27. Juhasz, R. (2018). Temporary Protection and Technology Adoption: Evidence from the Napoleonic Blockade. American Economic Review, 108(11), 3339–3376.
  28. Criscuolo, C., Martin, R., Overman, H. G., & Van Reenen, J. (2019). Some Causal Effects of an Industrial Policy. American Economic Review, 109(1), 48–85.
  29. Cai, J., & Harrison, A. (2021). Industrial Policy in China: Some Intended or Unintended Consequences? ILR Review, 74(1), 163–198.
  30. Aghion, Philippe, Jing Cai, Mathias Dewatripont, Luosha Du, Ann Harrison, and Patrick Legros. 2015. "Industrial Policy and Competition." American Economic Journal: Macroeconomics, 7 (4): 1-32.
  31. Boeing Philipp. 2016. The allocation and effectiveness of China’s R&D subsidies: Evidence from listed firms. Research Policy 45(9): 1774–89.
  32. Blonigen, B. A. (2016). Industrial Policy and Downstream Export Performance. Economic Journal, 126(595), 1635–1659.
  33. Rodríguez-Clare, A. (2007). Clusters and comparative advantage: Implications for industrial policy. Journal of Development Economics, 82(1), 43–57.
  34. Harding, T., & Javorcik, B. S. (2011). Foreign Direct Investment and Export Upgrading. The Review of Economics and Statistics, 94(4), 964–980.
  35. Agrawal,A., C.Rosell and T.Simcoe (2020), “Tax Credits and Small Firm R&D Spending”, American Economic Journal: Economic Policy, Vol.12/2, pp.1-21
  36. Bertoni,F. and T.Tykvová (2015), “Does governmental venture capital spur invention and innovation? Evidence from young European biotech companies”, Research Policy, Vol.44/4, pp.925-935
  37. Girma,S., H.Görg and I.Stepanok (2020), “Subsidies, spillovers and exports”, Economics Letters, Vol.186, p.108840
  38. Kalouptsidi,M. (2017), “Detection and Impact of Industrial Subsidies: The Case of Chinese Shipbuilding”, The Review of Economic Studies, Vol.85/2, pp.1111-1158
  39. Slavtchev,V. and S.Wiederhold (2016), “Does the Technological Content of Government Demand Matter for Private R&D? Evidence from US States”, American Economic Journal: Macroeconomics, Vol.8/2, pp.45-84
  40. Liu,E. (2019), “Industrial Policies in Production Networks”, The Quarterly Journal of Economics, Vol.134/4, pp.1883-1948