The Matthew effectin rebates: How does VAT rebates allocation affect firm export performance

• 成果类型: Article
• 署名作者: Lu, Bing; Ma, Hong
• 署名单位: Beijing Normal University; Tsinghua University
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2023.104982
• 发表日期: 2023
• 关键词: VAT rebates; Financial constraint; Export performance; Local fiscal constraint

摘要

Changes in Value-Added Tax (VAT) rebate rates affect exports. This paper shows, when financially strapped, the timely and efficient allocation of rebates becomes essential. Using a unique panel of Chinese firms with export and rebates information, we show that delay in rebates has negative but unequal effects on firm exports. Delays in rebates also cause more exit and reduce the product scope. Furthermore, we find a Matthew effectin allocating rebates: exporters with tighter financial constraints respond more elastically to a delay in rebates, yet they are also more likely to have a higher delay ratio. Thus, reducing rebates delay to the most constrained firms is more effective than a similar reduction to the least constrained firms. In partial equilibrium, correcting the misallocation in rebates would increase Chinese exports by 35%, while eliminating rebates delay would increase exports by 52%.