Amount Of Subsidy Research Articles

Investments, credit guarantees, and government subsidies in a regime-switching framework

Abstract This paper examines how credit guarantees and government subsidies impact investment in a regime-switching model. We provide new explicit pricing formulas for a general standard asset. Almost all common corporate securities’ prices can be easily derived by the explicit formulas though project cash flows are driven by both a Brownian motion and a two-state Markov chain. We provide a method about how governments should specify a proper tax subsidy standard for a given tax rate to motivate a firm to invest in a project in the way they wish. If the tax subsidy is sufficiently high (low), an overinvestment (underinvestment) occurs. The higher the tax rate, the more significant the overinvestment (underinvestment). We pin down the subsidy amount required for motivating a firm to invest immediately and fix the optimal capital structure with government subsidies.

Solutions to insufficient incentives for developing green tourism by travel agencies: government intervention

PurposeThis research aims to develop an improved model with government intervention and find the government policy for developing green tourism to induce the travel agencies have incentives to produce green tourism products.Design/methodology/approachThis research employs Stackelberg game theory to study two travel agencies in the horizontal direction of the tourism supply chain. Two deterministic, price-sensitive linear demand functions are utilized for these two different tourism products to derive possible analytical solutions.FindingsNo travel agency is willing to produce green tourism products without government intervention. The solution proposed in this paper is that a government should subsidize green travel agencies for their production of green tourism products, and create a tax for non-green traditional travel agencies for the production of non-green traditional tourism products. The amount of government subsidies for green tourism products plus the tax on non-green traditional tourism products equals the difference in unit cost of the two products. The travel agency that produces green tourism products has incentive to produce if there is government intervention.Practical implicationsThis paper provides the stakeholders with three practical implications. The first one is that the amount of subsidy for green travel agencies can be paid by taxing non-green ones. This is the optimal solution. The second one for both the tourism sector and government is that technological innovation in cooperation between government and tourism industry such as low-carbon technology is critical to reduce the cost difference between green travel agency products and non-green ones. The third one is that green travel agencies that produce green tourism products can also fulfill their corporate social responsibilities and enhance their social image.Originality/valueThis paper is unique in that it develops a model to resolve the problem of insufficient incentives. In terms of government intervention, this article also considers tax policy in addition to subsidy policy which is different from previous literature.

A Stackelberg game framework for promoting battery-powered construction machinery through government subsidies

Diesel-powered construction machinery is a major source of harmful pollutants and carbon emissions. Technological advancements have made battery-powered construction machines (BPCMs) increasingly viable in operations. However, the high purchase prices of BPCMs represent a huge obstacle for contractors to embrace these low-emission alternatives. To facilitate the sustainable development of the construction industry, it is imperative for the government to implement effective subsidy allocation policies to promote the electrification of construction machinery. This paper proposes a Stackelberg game framework for optimal subsidy allocation. In the proposed framework, the government decides the subsidy amount offered to each type of BPCMs to minimize both pollutant emissions and carbon emissions. The contractors can then observe the government’s decision and make their optimal decisions regarding the purchase, operation, and replacement of construction machines accordingly to minimize their total costs. Contractors’ decisions in turn influence the government’s decision. Such an intricate framework has many appealing properties, which are analyzed in depth to provide useful managerial insights. Additionally, the design of effective subsidy policies by the government depends on a precise prediction of the contractors’ demand for construction machinery. To this end, a random forest machine learning model is developed. Real data were collected for model construction and testing. Statistical results and industrial comments show the high quality of our predictions.

Monopsony and rent sharing: Evidence from Italian hiring subsidies

We estimate that hiring subsidies reduce concentration in labor markets where both small and large firms coexist. Wages increase only when HSs are in place and firms keep 96% of the subsidy amount, indicating that even small firms have relevant wage-setting power.

THE EFFECTIVENESS OF USING SUBSIDIES FOR CERTIFIED SEED MATERIAL USED FOR SOWING OR PLANTING

The work aims to assess the effectiveness of the subsidy system for purchasing certified seed material. The assessment was made based on data from the Statistics Poland on the sown area, data from the State Plant Protection Inspectorate on seed trade, and data from the Agency for Restructuring and Modernization of Agriculture on the amount of support provided to farmers, the analyzed changes in the amount of subsidies and the supply of certified seeds. Analyzing the motivation of farmers buying seeds was based on surveys conducted on farms in 2023 – the research concerned species covered by the subsidy system for cereals, potatoes, and large-seeded legumes. In total, the results were collected from 1,008 farms. A stimulating effect of subsidies in the initial period of their application and an improvement in the supply of certified seed material to farms was demonstrated. Maintaining the subsidies unchanged, and later, even at a nominally lower level, resulted in the disappearance of their stimulating effect. The main factors limiting farmers’ motivation to purchase certified seed material were indicated: the high prices of seed material, a lack of knowledge about the benefits of using certified seed material, low subsidy amounts, the exhaustion of the de minimis limit, and thus the possibility of using subsidies as well as an overly complicated subsidy system.

A Study on The Relationship Between Organic Agriculture and Agricultural Employment in Türkiye

Organic agriculture is a sustainable agricultural system with different principles that is carried out within the scope of certain rules. Due to the substitution of organic inputs with chemical inputs, getting the products ready for sale, weed control, and similar operations by hand, enterprises engaged in organic farming require a larger labor force. All these jobs increase employment opportunities in rural areas and allow small family businesses to continue production. In this study, it has been tried to reveal the relationship between organic agriculture and agricultural employment with the help of an econometric model and to determine the effect of organic agriculture on employment. The study analyzed a 17-year time series of data spanning from 2004 to 2021 to identify the factors influencing agricultural employment, taking into account various aspects of organic agriculture, including the number of organic agricultural products, the count of farmers engaged in organic agriculture, the area dedicated to organic agricultural production, the organic wild collection area, the total area allocated for organic agricultural production, the quantity of organic agricultural production, the number of entrepreneurs involved in organic agriculture, the unit price of subsidy for organic agriculture, and the total amount of subsidy provided to organic agriculture. Based on the results of the regression analysis, it was determined that the number of organic products does not have a significant effect on agricultural employment. In addition, it was found that the wild harvesting area is positively significant for agricultural employment and that the total production area of organic agriculture and the amount of subsidy are negatively significant. The results of the research reveal that a 1% increase in the wild harvesting area related to organic agriculture would lead to an increase of more than 0.28% in the agricultural employment rate, while a 1% increase in the total production area and the amount of subsidy would lead to a decrease of 0.40% and 0.44% in the agricultural employment rate, respectively.

Analysis of government subsidy strategies for blockchain-enabled green supply chains under competition

This study uses game-theory to construct a dual-channel green supply chain consisting of a manufacturer, a blockchain-enabled platform, and a non-blockchain-enabled offline retailer, with the aim of comparing two government subsidy strategies: greenness investment cost subsidy and production subsidy, and exploring the impact of blockchain adoption. First, firms without government subsidy should adopt blockchain only when privacy costs are low. Both subsidy strategies can always motivate the manufacturer to increase greenness investment levels and achieve a triple-win situation. Second, when the government controls the greenness investment level, the demand, profits, and subsidy amount under cost subsidy are always lower than those under production subsidy. Third, when the government controls the subsidy amount, the greenness investment level under cost subsidy is always higher than that under production subsidy. The offline demand and retailer’s profit are higher under production subsidy, while the online demand and platform’s profit are higher under cost subsidy. The manufacturer’s profit is higher under cost subsidy only when the subsidy level is low. Additionally, regardless of governmental goals, the platform’s profit is always higher than the retailer’s profit, indicating that downstream firms under government subsidy should always adopt blockchain.

Improving Northeast China’s soybean and maize planting structure through subsidy optimization considering climate change and comparative economic benefit

The planting structure of Northeast China (NEC) is greatly responsible for China’s food security and self-sufficiency. Climate change promoted the northward expansion of the suitable planting area for maize in NEC, and its higher comparative economic benefit largely helped it occupy the soybean planting space. Yet, knowledge on how climatic suitability and comparative economic benefit affected the northward expansion of maize planting area is limited. To bridge this gap, this study quantified the climatic suitability of maize and soybean from 1981 to 2020 using the fuzzy mathematical method. Combined with yield, crop distribution and social economic data in 2000, 2010 and 2020, this study further calculated the comparative economic benefit between the two crops. Furthermore, a crop planting decision simulation model was developed to clarify the impact of climatic suitability and comparative economic benefit on the planting area of soybean and maize. Results showed that from 2000 to 2010, the maize planting area increased dramatically. This was due to the continuous northward expansion of the most suitable region (S1) for maize from 47.63°N to 48.43°N before 2010, along with the fact that 65% of the total area was more profitable to plant maize. From 2010 to 2020, the maize planting area partially retreated, mainly due to the shrinking trend of the northern boundary of S1 for maize and the implementation of soybean producer subsidy. The improvement of maize climatic suitability played a fundamental role in the northward expansion of its planting area. On this basis, the comparative economic benefit was critical for planting proportion adjustments. The current soybean producer subsidy largely reduced the profit gap between the two crops, but it was still insufficient in nearly one-third of the total area. This study suggested to increase amount of soybean subsidies in the identified soybean-maize imbalanced regions. Specifically, the average recommended increase amounts ranged from 756 to 2052 CNY/ha depending on the regions. These findings could provide valuable references for understanding the motivation of crop planting decisions and optimizing the corresponding subsidy policies.

Regional dimension of the efficiency-support nexus in agriculture: Testing the land value approach in Russia

State support for agriculture is a crucial tool for adjusting the competitive advantages of agricultural producers to a volatile market environment. In countries with diverse natural conditions for agriculture, however, the allocation of subsidies often focuses on bridging spatial development gaps rather than maximizing the return on inputs. To improve the efficiency of resource use in agriculture, it is essential to tailor subsidy criteria to regional disparities in agricultural potential. Using the example of Russia’s 81 administrative regions, the authors have tested a five-stage methodology for determining the support-generated parameters of output, efficiency, impact, revenue, and profitability. This methodology takes into account both natural and economic factors that contribute to the competitive advantages of each region. The study aims to identify the parts of the performance indicators, such as gross agricultural output and revenue, that are influenced by the amount of subsidies in five different types of territories, which are categorized by the cadastral value of their farmland. It has been found that the allocation of subsidies is not entirely based on the return on the funds allocated. There is a discrepancy between the competitive advantages of these territories in agricultural production and the amount of funds they receive through government support programs. The efficiency of government support differs significantly depending on the type of agricultural product produced in each territory. The approach developed by the authors provides a tool that policy makers can use when tuning the allocation of subsidies based on the differences in the agricultural potential of each territory.

Research on Dynamic Subsidy Based on Deep Reinforcement Learning for Non-Stationary Stochastic Demand in Ride-Hailing

The ride-hailing market often experiences significant fluctuations in traffic demand, resulting in supply-demand imbalances. In this regard, the dynamic subsidy strategy is frequently employed by ride-hailing platforms to incentivize drivers to relocate to zones with high demand. However, determining the appropriate amount of subsidy at the appropriate time remains challenging. First, traffic demand exhibits high non-stationarity, characterized by multi-context patterns with time-varying statistical features. Second, high-dimensional state/action spaces contain multiple spatiotemporal dimensions and context patterns. Third, decision-making should satisfy real-time requirements. To address the above challenges, we first construct a Non-Stationary Markov Decision Process (NSMDP) based on the assumption of ride-hailing service systems dynamics. Then, we develop a solution framework for the NSMDP. A change point detection method based on feature-enhanced LSTM within the framework can identify the changepoints and time-varying context patterns of stochastic demand. Moreover, the framework also includes a deterministic policy deep reinforcement learning algorithm to optimize. Finally, through simulated experiments with real-world historical data, we demonstrate the effectiveness of the proposed approach. It performs well in improving the platform’s profits and alleviating supply-demand imbalances under the dynamic subsidy strategy. The results also prove that a scientific dynamic subsidy strategy is particularly effective in the high-demand context pattern with more drastic fluctuations. Additionally, the profitability of dynamic subsidy strategy will increase with the increase of the non-stationary level.

Study on the Spatial Effects of Grain Change on Food Security of Feed from the Perspective of Big Food

Using panel data from 30 provinces in China from 2005 to 2020, this paper uses a spatial double difference model to evaluate the policy impact of the “grain-to-feed” policy on feed grain production in pilot areas and adjacent spatial areas. Research has found that the “grain-to-feed” policy has a significant impact on the feed grain production in pilot areas and can significantly increase the feed grain production in pilot areas by about 2.71 million tons. The “grain-to-feed” policy has strengthened the positive connection between pilot areas and adjacent pilot areas, increased feed grain production, and has a significant spatial spillover effect. Robustness analysis shows that whether using different methods to measure spatial adjacency or using different standards to distribute subsidies, the “grain-to-feed” policy can significantly increase feed grain production, narrow the supply and demand gap of feed grain, and ensure feed grain security. Further analysis shows that the “grain-to-feed” policy can not only ensure the security of feed grain for the current and next periods but also promote the increase in farmers’ income, which is long-term and sustainable. Compared with non-pilot areas, the “grain-to-feed” policy can mitigate the negative impact of wage–price signals on feed grain production in pilot areas. It is recommended that government departments accelerate the transformation of food security concepts, establish a “Big Food Perspective”, gradually promote the pilot of the “grain-to-feed” policy nationwide, increase the subsidy amount of the “grain-to-feed” policy, increase financial support for scientific and technological research and achievement transformation in the field of feed grain, prevent the impact of economic price signal fluctuations on feed grain production, and effectively ensure the security of feed grain in China.

An analysis of the effect of agriculture subsidies on technical efficiency: Evidence from rapeseed production in China

This study was conducted to examine the effects of agricultural subsidies on the technical efficiency of agricultural production technology and on factor input. It utilized a random frontier production function, instrumental variable method, and threshold regression model. The data used for this analysis consisted of 609 field yield measurements from the National Rapeseed Industry Technology System in 2020. The findings indicate that agricultural subsidies have a substantial impacts and it increases the technical efficiency of production process. Specifically, these subsidies encourage the use of land resources while inhibiting the use of chemical fertilizers. However, this does not have a significant effect on the utilization of labor and capital resources. Furthermore, the impact of agricultural subsidies on production technology efficiency varies depending on the scale of the farming operation. The subsidies significantly enhance the production technology efficiency of farmers with a business scale of less than 0.67 ha, but do not significantly improve the production technology efficiency of farmers with a business scale exceeding 0.67 ha. To optimize the effectiveness of agricultural subsidy policy, three methods and recommendations are proposed: increasing the overall amount of subsidies, expanding and diversifying the types of subsidies, and refining the process of disbursing subsidies.

Balancing Variety and Quality: Examining the Impact of Benefit‐Linked Cross‐Subsidization on Multisided Platforms

AbstractMultisided platforms face a fundamental trade‐off: should they ease entry for a larger number of providers of complementary products or services (complementors) to join the platform and benefit from cross‐side network externalities, or should they limit entry to maintain complementors’ incentives to provide high‐quality offerings? We contend that a specific cross‐subsidizing pricing strategy – where the amount of subsidy to complementors is explicitly linked to the overall revenue they generate on the other side of the platform – may mitigate this trade‐off. Using data from the airport industry, we demonstrate that following a reduction of airlines’ entry barriers, airports that subsidize airlines, based on the aforementioned scheme, can boost their financial performance and maintain traffic composition in favour of legacy airlines, which bring passengers who spend more in airport shops. Our findings shed light on how cross‐subsidization may balance the variety and quality of complementors and their offerings on multisided platforms.

Can government subsidy promote the light-blue fishery upgrade to deep-blue fishery?

IntroductionThe expansion of fishery development from offshore to deep-sea areas has become essential for countries to address environmental constraints and ensure food security. This study aims to establish a cooperative development model for deep-blue fishery involving the government, fishery enterprises, and consumers.MethodsWe constructed an evolutionary game and simulation model to analyze the government's deep-blue fishery subsidy strategy. The model considers the interactions between the government, fishery enterprises, and consumers, evaluating how different subsidy strategies influence the development of deep-blue fishery.ResultsOur results demonstrate that government subsidies can stimulate the growth of deep-blue fishery from both the demand and supply sides. Specifically, the likelihood of government subsidies positively affects fishery enterprises' engagement in deep-blue fishery development and consumers' willingness to purchase deep-blue fishery products. The evolutionary game system reaches different steady states based on the cost-benefit changes for the government, fishery enterprises, and consumers, leading to various optimal subsidy strategies.DiscussionThe findings indicate that the amount of government subsidy should be optimized rather than maximized, as excessive subsidies may not yield proportionate benefits. Additionally, subsidizing fishery enterprises proves to be more effective in promoting the development of deep-blue fishery compared to subsidizing consumers. These insights can guide policymakers in designing efficient subsidy strategies to foster sustainable deep-sea fishery development.

Constraints Faced and Suggestions Offered by Women Self Help Group Members in Cuddalore District, India

Women's empowerment is essential to ensuring equal access to opportunities and their rights are properly respected. This is accomplished by enhancing and expanding women's social, economic, political, and legal existence. The present study was conducted in Cuddalore Block of Cuddalore District. A proportionate random sampling procedure was applied to select 120 respondents. They were members of Mahalir's Women Self-Help Group. Thittam project under, the organizational efforts taken by the Tamil Nadu Corporation for Development of Women (TNCDW) to define the constraints faced and suggestions offered by the members of SHGs. The study found that lack of awareness about credit sources, followed by a lack of adequate communication skills and more dependence on leaders are the major personal constraints faced by women SHG members. Also, insufficient credit facilities, followed by a lack of periodical training and a lack of marketing channels for selling their produce, are the major organisational constraints women SHG members face. Among the suggestions, the majority of the members offered to increase the loan amount, enhance the subsidy amount to the women members and create employment opportunities for women members.

Research on Stakeholder Behavior Strategy in Green PPP Project Financing

In the context of green development, while promoting green industry and sustainable development, green PPP faces the challenge of financing difficulties. Based on the evolutionary game theory of bounded rationality and taking government, social capital and financial institutions as the game players, this paper constructs an evolutionary game model for the behavioral decision-making of stakeholders in green PPP project financing. Using MATLAB software, we simulate and analyze the key factors affecting the behavioral strategies of each game player. The results indicate that: (1) The additional income obtained from participation in green PPP projects is a key factor affecting the decision-making of social capital and financial institutions, so it is necessary to improve the reasonable return mechanism of green PPP projects and attach importance to the construction of reputation mechanism; (2) Government subsidies can effectively encourage social capital and financial institutions to participate in green PPP projects, but the amount of subsidies should be within a reasonable range; (3) The government's reward and punishment intensity is a significant factor affecting the decision-making of social capital behavior. To this end, it is imperative for the government to enhance the performance evaluation system for green PPP projects and establish a balanced reward and punishment mechanism. This paper puts forward some suggestions on the decision-making of stakeholders in the financing process of green PPP projects, and provides references for the policy formulation of encouraging social capital and financial institutions to participate in green PPP projects.

Impact of income and financial subsidies on oral health care utilization among persons with disabilities in Singapore.

Globally, studies have shown that the dental disease burden among persons with intellectual and/or developmental disabilities (IDD) is high and can be attributed to lower utilization levels of dental services. The aim of the study was to assess the influence of income and financial subsidies on the utilization of dental care services among persons with IDD in Singapore. Between August 2020 and August 2021, a cross-sectional study was conducted via centres offering Early Intervention Programme for Infants and Children, special education schools and adult associations in Singapore serving persons with IDD. A sample of 591 caregivers of children and adults with IDD completed the survey. Data on sociodemographic information, oral health behaviours and dental utilization were collected. Financial subsidy status was assessed by the uptake of a government-funded, opt-in Community Health Assist Scheme (CHAS) for low-income families that provided a fixed subsidy amount for dental services in the primary care setting. Statistical analysis was carried out using univariable, multiple logistic regression and modified Poisson regression. Propensity score matching was carried out in R version 4.0.2 to assess the impact of financial subsidies on oral health care utilization among persons with IDD. Compared to those with lower gross monthly household incomes, the adjusted prevalence ratios of having at least one dental visit in the past year, having at least one preventive dental visit in the past year, and visiting the dentist at least once a year for persons with IDD with gross monthly household incomes of above SGD$4000 were 1.28 (95% CI 1.08-1.52), 1.48 (95% CI 1.14-1.92) and 1.36 (95% CI 1.09-1.70), respectively. Among those who were eligible for CHAS Blue subsidies (247 participants), 160 (62.0%) took up the CHAS Blue scheme and 96 (35.4%) visited the dentist at least yearly. There was no statistically significant difference in the utilization of dental services among individuals enrolled in the CHAS Blue subsidy scheme among those eligible for CHAS Blue subsidies. Higher household income was associated with a higher prevalence of dental visits in the past year, preventive dental visits in the past year, and at least yearly dental visits. CHAS Blue subsidies alone had limited impact on dental utilization among persons with IDD who were eligible for subsidies.

Subsidizing the Shift to Renewable Energy in Korea: A Levelized Cost Analysis and Computation of Required Subsidies

This study addresses the pivotal challenge of transitioning from nuclear to renewable energy sources, considering the distinctive energy landscape of South Korea characterized by high land costs and high dependence on nuclear energy. Amidst global momentum toward sustainable and carbon-neutral energy, South Korea’s Renewable Energy 3020 Implementation Plan aims to achieve 20% of power generation from renewables by 2030. Shifting away from nuclear energy, however, may lead to rising energy costs, supply disruptions, and environmental ramifications. Furthermore, achieving grid parity between renewable energy and nuclear power by the late 2030s is unlikely, in contrast to earlier projections. This is primarily due to the comparatively lower production cost of nuclear energy. To expedite the shift toward renewable energy, our study suggests transitioning from the Renewable Energy Portfolio Standard (RPS) to a Feed-in-Tariff (FiT) system. This change would offer voluntary incentives for investment in renewable energy. Additionally, we compute Feed-in-Tariff subsidies required to achieve grid parity by 2030, concluding that the amount of subsidies required to reach grid parity by 2030 is 54% of retail electricity price. This research offers valuable insights for policy formulation and energy transition planning.

Impact of Consumer Subsidy Considering Subsidy Threshold on New Energy Vehicle Firms and Environmental Benefits

This paper investigates a competitive market consisting of two new energy vehicle (NEV) firms with a technology gap and consumers with green preferences. By employing a Hotelling model, we obtain the equilibrium outcomes of two competing firms without and with segmented consumer subsidy (SCS) following Nash game theory. We further explore the incentive effect, effective scope of SCS policy and the impacts of subsidy threshold and technology improvement on it, which fills the gap in the literature and provides managerial insights. We find that SCS can only play a role when the threshold is intermediate, and the government can expand the effective scope of subsidies by cultivating consumers’ green preferences and strengthening the intensity of subsidies. Moreover, the government can change the competitiveness and green level gap of two firms through the threshold. When threshold is small (large), increasing it can narrow (expand) the green level gap between two firms but widen (narrow) the market gap. We also find that implementing an SCS policy has a positive impact on environmental benefits and technological improvement is more likely to cause environmental damage. However, the government can effectively decrease the degree and probability of damage by raising the subsidy threshold and reducing the subsidy amount.

A game-theoretical approach for the adoption of government-supported blockchain application in the IoT-enabled agricultural supply chain

Establishing a reliable, cost-effective, and data-accessible supply chain is a requirement for all administrations. The significance of such a supply chain lies in its ability to strengthen national resiliency, ensure economic security, and foster sustainable growth. Governments know financial investments and subsidies in infrastructure, logistics, and technology are necessary for a robust supply chain. This paper proposes an IoT-enabled agricultural supply chain that integrates with a cooperative Nash game between two parties: telecommunications operators and agricultural enterprises. The aim is to establish cooperative decision-making procedures in advance of the integration of blockchain technology into the supply chain, which is regulated by the subsidy policy of the government. The Nash game yields a unique Nash equilibrium, indicating that both parties can engage in cooperative negotiations regarding their participation in the blockchain application to maximize their financial profits. To illustrate the efficacy of Nash collaboration in blockchain adoption, this study presents two scenarios where non-cooperative behavior is explored to analyze stakeholder responses in competitive contexts. Numerical results justify the theoretical findings and suggest Nash cooperation among stakeholders instead of competition in the blockchain-based agri-food market, which leads to a more accessible market environment that ultimately benefits consumers. Moreover, the positive and negative aspects of the deployment of the government-supported blockchain application are derived through sensitivity analyses conducted on subsidy rate, agricultural market price, subsidy amount, and blockchain market. Practical managerial implications are derived from the findings and observations to help policymakers formulate blockchain policies in agricultural supply chains supported by governments.