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China's hidden shipbuilding subsidies

China’s shipbuilders have doubled their market share in recent years. It is hard to determine the role of industrial policy, particularly subsidies, in this because we do not know what policies are in place. This column argues that subsidies decreased shipyard costs in China by between 13% and 20% between 2006 and 2012. These policy interventions have led to substantial misallocation of global production with no significant consumer surplus gains.
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