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China's 2004 value‐added tax (VAT) pilot reform in the Northeast region, which changed the VAT from production type to consumption type, introduced a sizable tax credit for fixed investment in manufacturing industries, leading to more investment and higher productivity at firm level. This paper, however, uses difference‐in‐difference estimation and finds a negative structural effect; that is, the...
The astonishing surge in China's international trade is the result of comprehensive economic reforms in the 1980s and 1990s. Trade was further bolstered by China's accession to the World Trade Organization (WTO) in 2001. We examine several aspects of China's international trade that might help to explain its surprisingly fast growth and its ever‐growing role in the global economy. A large number of...
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