Subsidy Levels Research Articles

Can Civilized City Construction Promote Enterprise Green Innovation?

The existing research shows that when facing the trade-off between economic benefits and green innovation, enterprises often prioritize economic gains, and how to promote enterprise green innovation (EGI) has become a pressing issue that needs to be solved at this stage. Against this backdrop, China’s Civilized City Construction (CCC) policy, which emphasizes the coordinated development of economic, political, ecological, and spiritual civilization, places higher demands on enterprise environmental behaviors. This creates an opportune moment to investigate the relationship between urban governance policies and EGI. In this study, we employ a Difference-in-Differences (DID) model to examine whether the CCC policy can promote EGI and reveal its underlying mechanisms. The research findings indicate that CCC significantly promotes EGI. The policy improves EGI levels by strengthening regional environmental regulations and increasing environmental subsidy levels. This finding provides lessons for advancing enterprise sustainability strategies and new perspectives for global urban governance policy formulation and implementation.

The impact of solar PV subsidies on investment over time - the case of Sweden

Over the past decade, different economic incentives have been created to increase investments in solar photovoltaics (PV). Although research outlines that investors in renewable electricity technologies (RET) are heterogeneous, policies have not taken this into account when designing subsidy programs. This paper aims to analyse the relationship between policy incentives and the willingness to invest in PV systems for different investor groups, including households, companies, associations, and public organizations. Using data from all applications to the capital subsidy program for PV in Sweden between 2009 and 2021, we analyse the impact of the subsidy level on investments over time. Our analysis shows that the subsidy has had a positively significant impact for households and private companies as investor groups. However, we also found that other variables have had a significantly positive or negative effect on the willingness to invest for different investor groups. This stresses the need of going from “one size fits all” policies to policies that better adapted to different investor characteristics. To meet the urgent need to accelerate the diffusion of RETs, our results show the impact of investor heterogeneity on policy responsiveness and provide avenues for the design of targeted policies.

Planning incapacitated: Environmental planning and the political ecology of austerity

Coal mining in the UK, once central to its political economy, has been in terminal decline for decades for both political and more recently environmental reasons. Against the grain of this decline, the proposal of a new metallurgical coal mine near Whitehaven (on the north west coast of England) has caused significant controversy. Those supporting the mines development say it is necessary to ‘level up’ from the previous decade of austerity, whereas opponents argue that new coal mining would severely undermine the transition to low carbon energy sources. Through a discourse analysis and open-ended interviews, this paper analyses the contestation of the mine through the environmental planning process, identifying how both the discursive contestation and decision-making practices are shaped by political logics (austerity/levelling up) and ecological logics (climate change). The paper finds that, as states turn towards greater levels of public subsidies as a new form of crisis management, the environmental decision-making processes which can determine the shape of investments have been severely undermined through a decade or more of reduced public investment, policy streamlining and a lack of public expertise. The paper argues that even though states may be turning towards policies subsidising energy projects, they are doing so in a context where there is a lack of state capacity due to a ‘political ecology of austerity’, limiting public capacity to plan for a better future.

Analysis of Corporate Decisions Considering Low-carbon Transition

This paper analyses the practice of green development and autonomous low-carbon transformation of enterprises, mainly through the literature to analyse the importance of low-carbon transformation of enterprises as well as various factors affecting low-carbon transformation of enterprises. It is argued that in addition to the influence of their own enterprise structure, the low-carbon transition of enterprises will be affected by the demand of consumers and service providers, the level of government low-carbon subsidies and low-carbon transition technology. It also puts forward relevant suggestions for low-carbon transition. This paper proposes the establishment of low-carbon transition partners, the establishment of diversified multi-channel financing methods, the sound consumer experience service function, and the realisation of enterprise scale.

Optimal subsidy policy for new energy vehicles based on the influence of multiple factors and consumers' green preference

AbstractPolicies concerning subsidies for new energy vehicles and consumers' environmental preferences significantly impact the sales of such vehicles. To investigate the correlation between sales and subsidies or consumers' environmental preferences and to devise optimal subsidy strategies, two Stackelberg game models are constructed based on both monopoly and duopoly markets, with solutions derived for Nash equilibrium points. In order to refine the strategy for subsidy adjustments, two dynamic adjustment models considering bounded rationality are established. Additionally, the process of adjusting subsidies towards Nash equilibrium points is analyzed. Simulations, utilizing actual research data, are performed to assess China's current adjustment strategies. The findings reveal a substitution relationship between consumers' environmental preferences and subsidies. Furthermore, optimal subsidy levels and bounded rational subsidy adjustment strategies are identified. Governments should thoroughly consider consumers' environmental preferences when refining subsidy policies, as it is a crucial factor influencing the development of the new energy vehicle industry.

Optimization of the subsidy for university faculty relocation in campus suburbanization

This study explores the optimal subsidy policy to maximize the benefits associated with the suburbanization of university campuses. A transport accessibility index is introduced, and a model is developed to analyze faculty housing relocation, incorporating factors such as transport accessibility, housing price, relocation subsidy, and the influence of children. The impact of housing relocation is assessed using a regional output model that considers both production and consumption aspects. Subsequently, a decision-making model is established to determine the optimal subsidy level and the number of faculty to relocate, with the overarching goal of maximizing total regional benefits. The findings reveal that an increase in subsidies correlates with a rise in the willingness of faculty to relocate, leading to heightened benefits for the region. However, the rate of benefit increase shows diminishing returns with each increment change in the subsidy. Notably, the study demonstrates that 70% of the additional benefits to the region emanate from the housing market, accurately reflecting the current financial landscape in China. This insight underscores why city governments frequently leverage land markets to actively promote suburbanization.

Regional competition, spatial spillover effects, and entrepreneurship subsidy policies—evidence from incubators in Guangdong, China

ABSTRACT Using data from 2016 to 2018 for all incubators in Guangdong, China, we find that for start-up incubators, the average subsidy level of the city where the incubator is located is significantly positively correlated with the number of patents obtained per unit area of the incubator, regardless of the subsidy amount obtained by the incubator itself. However, this phenomenon is not significant for incubators that have been established for more than 1 year. The subsidy policy of the local government has a significant positive direct effect on the number of patents obtained per unit area of local incubators, but a significant negative indirect effect on incubators in neighbouring regions. Both effects are similar in magnitude, with the overall effect of the subsidy policy being almost completely offset. Therefore, owing to the spatial spillover effect, a considerable part of the effect of the local government subsidy policy only manifests as competition for high-quality enterprises between regions, and the actual improvement of the operational performance of the enterprises themselves is not obvious. Therefore, ignoring the spatial spillover effect of subsidy policies greatly reduces their actual effect.

Emission abatement in low-carbon supply chains with government subsidy and information asymmetry

Governmental subsidy policy and channel information structure have substantial effects on supply chain emission reduction, operations and marketing decisions. In this paper, we use game theory to study the interplay of government subsidizing arrangement and information asymmetry on manufacturers' emission reduction and retailers' low-carbon promotion. Suppose realistically that the investment coefficients for manufacturers' emission reduction levels and retailer' low-carbon promotion levels are their respective private information. Among diverse governmental subsidy schemes, we find dual subsidizing are the best choice for the defined level of total subsidy under information asymmetry, while it is not always the best choice if the total subsidy level is uncertain. Under information asymmetry, the results show that manufacturer have no incentive to lie under any subsidy policy. However, the retailer has incentive to misrepresent individual information and its misreporting behaviour is related to the coefficient and allocation ratio of governmental subsidies. On this basis, we illustrate that a screening model can be deployed to reduce the negative effects of information asymmetry on supply chain operations. We therefore propose the method of improving the performance of low-carbon supply chains under various situations of information asymmetry and governmental subsidizing schemes to achieve system-wide Pareto improvement.

Study on the symbiosis evolution mechanism of the digital innovation ecosystem: considering government regulation

PurposeThe purpose of this paper is to analyze the symbiotic evolution decisions of digital innovation enterprises, research institutes and the government in the digital innovation ecosystem.Design/methodology/approachBased on innovation ecosystem theory and an evolutionary game model, this study constructs a tripartite symbiotic evolution game model of digital innovation ecosystems with digital innovation enterprises, research institutes and the government as the main bodies and analyzes the influencing factors as well as the evolution paths of the different behavioral strategies of each subject through numerical simulation.FindingsThe research shows that the digital innovation ecosystem has the characteristic of self-organization, which requires the symbiotic cooperation of each subject. The government plays an active role in any stage of symbiotic evolution, and the system cannot enter symbiosis under a low level of subsidies and penalties. Only when the initial willingness to cooperate of digital innovation enterprises and scientific research institutes is at a medium or high level is the system likely to become symbiotic. While digital innovation enterprises are more sensitive to government subsidies and punishments, scientific research institutes are more sensitive to the distribution proportion of cooperation income.Originality/valueThis study includes government regulation into the research scope, expands the research mode of the digital innovation ecosystem and overcomes the difficulties of empirical research in collecting dynamic large sample data. It vividly and systematically simulates the symbiotic evolution process of the digital innovation ecosystem, which provides a theoretical and practical reference for digital innovation ecosystem governance.

Exploring effective incentive policies for sustainable development of green buildings in China: based on evolutionary game theory and numerical simulation analysis

PurposeThis study reveals the green building development path and analyzes the optimal government subsidy equilibrium through evolutionary game theory and numerical simulation. This was done to explore the feasible measures and optimal incentives to achieve higher levels of green building in China.Design/methodology/approachFirst, the practice of green building in China was analyzed, and the specific influencing factors and incentive measures for green building development were extracted. Second, China-specific evolutionary game models were constructed between developers and homebuyers under the market regulation and government incentive mechanism scenarios, and the evolutionary paths were analyzed. Finally, real-case numerical simulations were conducted, subsidy impacts were mainly analyzed and optimal subsidy equilibriums were solved.Findings(1) Simultaneously subsidizing developers and homebuyers proved to be the most effective measure to promote the sustainability of green buildings. (2) The sensitivity of developers and homebuyers to subsidies varied across scenarios, and the optimal subsidy level diminished marginally as building greenness and public awareness increased. (3) The optimal subsidy level for developers was intricately tied to the building greenness benchmark. A higher benchmark intensified the developer’s responsiveness to losses, at which point increasing subsidies were justified. Conversely, a reduction in subsidy might have been appropriate when the benchmark was set at a lower level.Practical implicationsThe expeditious advancement of green buildings holds paramount importance for the high-quality development of the construction industry. Nevertheless, the pace of green building expansion in China has experienced a recent deceleration. Drawing insights from the practices of green building in China, the exploration of viable strategies and the determination of optimal government subsidies stand as imperative initiatives. These endeavors aim to propel the acceleration of green building proliferation and materialize high-quality development at the earliest juncture possible.Originality/valueThe model is grounded in China’s green building practices, which makes the conclusions drawn more specific. Furthermore, research results provide practical references for governments to formulate green building incentive policies.

Оптимізація транспортно-логістичної системи задля спрощення переміщення населення сільської місцевості

The purpose of the article is to examine existing data for the selection of survey areas, data collection for the mobile network at the level of travel chains, and analysis of travel patterns. Travel demand in three rural areas with different population densities is considered, and requirements for new mobility solutions based on demand and people's travel habits are established.
 Public transport plays a decisive role in the logistics of territorial communities of Ukraine. However, inadequate provision and implementation of technological advances have left rural areas behind and heavily dependent on private cars. This article describes how to improve the availability of transport services in rural areas, where the demand for travel is often underestimated. The demand for travel in three rural areas with different population densities was analyzed, and the requirements for new mobility solutions based on demand and people's travel habits were determined.
 There is a need to access a higher level of subsidies if on-demand mobility services cannot attract an adequate level of demand so that rural and semi-rural communities have access to the same level of services and opportunities available to urban areas. Most of these services are deployed in urban settings with high travel demand and population density. Research on regions with low demand is rarely considered.
 Many on-demand services are community-based, where demand is determined based on local knowledge and specific needs. Those mobility services that are more commercially oriented use qualitative market research to determine demand for specific population segments and specific locations.
 Social isolation is exacerbated by lack of accessibility, roads and public transport, but is also linked to socio-demographic factors.
 It is suggested that consideration be given to removing barriers to commercially viable new mobility services in rural areas by: using data-driven approaches to understand typical daily travel patterns; identifying new mobility services that can be deployed for commercial purposes and those that will require ongoing financial support to provide socially necessary services.

Energy-aware production planning models for emerging economies

Manufacturing plays a vital role in fostering economic growth, yet it is one of the major consumers of energy. Considering energy consumption when devising an Aggregate Production Plan (APP) is a determinant of a more energy-efficient production schedule at the operational level. Manufacturers in emerging economies envisage planning challenges when energy reforms are introduced. A guide for analysis and decision-making in the transitional phase of phasing out energy subsidies is essential. This work tackles this problem by developing two mixed-integer linear programming models for energy-aware production planning. The first model targets maximising profit while explicitly using the energy cost as one of the cost elements. The second is an energy-driven model to minimise energy consumption while including profit as a constraint. The proposed models were validated via a real-life dataset. The models provide the decision-makers with the flexibility to improve their production plans’ energy efficiency by either developing plans that reduce energy consumption without sacrificing profit or developing production plans that increase profit without increasing energy consumption. The results imply that adopting Energy-Efficient Production Planning (EEPP) is substantial with high subsidy levels. For low subsidy levels, strategic decision-making entailing the deployment of technological solutions is more efficient.

Pricing and Timing Decisions in Promotion Channels

When planning for online promotion festivals, retailers must consider both pricing and timing decisions to determine an appropriate promotion strategy. In this article, we first consider <italic xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink">retailer-promotion channel</i> where the retailer sells a new product on his marketing channel in normal and promotion sales periods. A greater number of early consumers can reduce late consumers' risk perception for product performance and increase their utilities via word-of-mouth. Consumers arriving in the promotion sales period strategically time purchases to maximize their utilities. Our analysis shows that when word-of-mouth is strong and consumers are patient to wait for price markdown, the retailer increases the price from that of the normal sales period and then provides price discounts. Otherwise, the retailer sets a high initial retail price to earlier pursue high marginal profit. We then consider <italic xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink">platform-promotion channel</i> where the retailer sells the product on the platform. Our analysis suggests that three additional factors in platform-promotion channel, commission rate, subsidy level, and market expansion, have distinct impacts on the equilibrium pricing and timing decisions. Interestingly, we find that the retailer's profit can be nonmonotonic in the subsidy level and a higher subsidy level does not necessarily induce the retailer to engage in platform-promotion channel.

Identification of optimal organic fertilizer subsidy policies under dual uncertainty via a self-calibrated fuzzy-boundary interval programming method

The effective design of organic fertilizer subsidy policies requires a precise understanding of their socio-economic and environmental impacts under uncertainty. However, previous methods face challenges in accurately simulating policy impacts due to the lack of a calibration process for observations and their inability to handle the dual uncertainty, where intervals and fuzziness coexist within a parameter. To fill such gap, a fuzzy-boundary interval positive mathematical programming (FIPMP) model was proposed. FIPMP improves upon previous positive mathematical programming (PMP) by handling dual uncertainties expressed as fuzzy-boundary intervals in both the objective function and constraints. FIPMP can also calibrate to observed values and address constraint-violation issues. This study further integrated the inventory analysis (IA) method into the FIPMP framework (IA-FIPMP), which enabled the impact analysis of organic fertilizer subsidy policies on TN and TP loads. Applied to a case study in Chengde City, Northern China, IA-FIPMP simulated the effects of various subsidy policies, prioritizing profit maximization and considering water resources and environmental constraints. The recommended optimal subsidy levels ranged from 300 to 600 yuan/ton, depending on the water availability and pollution discharge permits. The recommended subsidy levels could lead to a maximum reduction of 140,000 kg in TN loads and 9000 kg in TP loads, as well as a maximum increase of 3.3 times in the organic fertilizer use area. The study further reveals that quality-based subsidy policies outperform area-based subsidy policies in promoting organic fertilizer utilization and increasing farmer income. Compared to interval PMP and interval credibility-constrained PMP, FIPMP expands the capability of uncertainty treatment by handling dual uncertainties and enhances model robustness by balancing system benefits and violation risks. FIPMP can be used to simulate the impacts of other types of policies.

Can Subsidy Policies Reduce Vaccine Hesitancy Under Social Learning?

Vaccine hesitancy refers to a delay in getting or refusing vaccinations for efficacy reviews from early vaccinated individuals (e.g., social learning). However, no reviews occur if everyone delays. To overcome vaccine hesitancy, we first introduce social learning to characterize this undesirable behavior in two-period vaccine market (composed of a government, a manufacturer, and individuals). Then, designing subsidy policies are in three aspects: subsidy recipients (who should be subsidized, individuals or manufacturer), subsidy times (when subsidy policies should be set, preannounced or responsive), and subsidy paths (how the subsidy level should be adjusted over two periods, increasing or decreasing). Some results are yielded. First, if subsidy recipients are individuals, sales subsidies occur, and their equilibrium subsidy paths hinge on subsidy times. When sales subsidies are preannounced in the first period, a decreasing path is always optimal. In contrast, when these subsidies are responsive in two periods, an increasing path may be optimal. Second, these optimal sales subsidies can counter vaccine hesitancy and, further, utilize social learning to enhance vaccine coverage with different levels. Their differences are affected by two factors (government budgets and uncertain vaccine efficacy levels) that have asymmetric roles. Finally, if subsidy recipients are shifted from individuals to the manufacturer, cost subsidy occurs but it fails to overcome vaccine hesitancy.

Government Subsidy Nexus: The Case of Employment and Performance Dynamics

In this article, the impact of nexus of subsidy on economic growth and performance is examined, with focus on age influence. We analyse data from 1,272 Chinese manufacturing firms from 2007 to 2017 using quantile regressions and Generalized Method of Moments. The findings indicate that subsidies have a positive effect on employment growth but a negative impact on performance. Age is found to have a weaker moderating effect on the subsidy-performance relationship but a stronger effect on the subsidy-employment-growth relationship. Young and private firms experience alternating growth patterns, while state and matured firms consistently exhibit positive growth across all quantiles. The study also reveals that lagged employment and subsidy levels have a significant positive relationship with current employment-related issues, while performance shows a change in direction with lags. Our result shows that subsidy impacts better on growth rather than performance as a by-product. However, with limiting recommendations on governments efforts to overspend on young firms. We discuss our findings within the theoretical frameworks of the economics of subsidy and the theory of cost and benefit for emerging markets.

Drivers of MSME loan defaults using survival analysis: implications for lenders and policy planners

PurposeThe authors analyse the determinants of loan defaults in micro, small and medium enterprises (MSME) loans in India from the survival duration perspective to draw inferences that have implications for lenders and policymakers.Design/methodology/approachThe authors use the Kaplan–Meier survivor function and the Cox Proportional Hazard model to analyse 4.29 lakhs MSME loan account data originated by a large bank having a national presence from 1st January 2016 to 31st December 2020.FindingsThe estimated Kaplan–Meier survival function by various categories of loan and socio-demographic characteristics reflects heterogeneity and identifies the trigger points for actions. The authors identify the key identified default drivers. The authors find that the subsidy amount is more effective at the lower level and its effectiveness diminishes significantly beyond an optimum level. The simulated values show that the effects of rising interest rates on survival rates vary across industries and types of loans.Practical implicationsThe identified points of inflection in the default dynamics would help banks to initiate actions to prevent loan defaults. The default drivers identified would foster more nuanced lending decisions. The study estimation of the survival rate based on the simulated values of interest rate and subsidy provides insight for policymakers.Originality/valueThis study is the first to investigate default drivers in MSME loans in India using micro-data. The study findings will act as signposts for the planners to guide the direction of the interest rate to be charged by banks in MSME loans, interest subvention and tailoring subsidy levels to foster sustainable growth.

Electric vehicle battery-charging service and operations managing under different charging station construction modes

Using electric vehicles (EVs) is considered as an effective way to reduce carbon emissions. In practice, (self) charging-mode EVs (CEVs) require a long charging time, which has led to the emergence of (battery) swapping-mode EVs (SEVs). This study first discusses whether the manufacturer should introduce SEVs and identifies the introduction conditions. Further, it investigates the impact of two construction modes (manufacturer-construction mode and commission-construction mode) of energy replenishment stations on pricing decisions, EVs demand, and profits. Finally, we optimize the government subsidy level to minimize the total capital expenditure for a specific EVs adoption target. The results reveal that introducing SEVs can bring more stations, higher retail price and charging service fee for CEVs, as well as greater demand for EVs when the unit production cost of CEVs is high. If the consumers’ preference for SEVs is low, introducing SEVs can increase profits in most cases; if the consumers’ preference for SEVs is high, introducing SEVs is detrimental to the EVs manufacturer only when the government subsidy is not too high. Comparing to the commission-construction mode, the manufacturer-construction mode can bring more stations, higher total demand for EVs, and higher total profits; meanwhile, it can lower the optimal subsidy level of the government.

Optimal pricing and warranty strategies of a closed‐loop supply chain under government subsidies

AbstractBoth warranty services and subsidy policies are effective strategies for promoting the development of remanufacturing. According to the warranty provider, this paper considers two possible warranty strategies: the manufacturer warranty and the retailer warranty. The optimal pricing and warranty periods are determined by considering the effect of the consumption subsidy policy through Stackelberg game models. Subsequently, this paper investigates the optimal warranty strategy by comparing the economic and integrated performance of the closed‐loop supply chain. The analytical results indicate that the retailer warranty enables the supply chain to obtain a higher economic performance than the manufacturer warranty. Nevertheless, the integrated performance that combines economic and environmental performance depends on the consumption subsidy level. In addition, this paper finds that the consumption subsidy policy enhances supply chain profitability and consumer surplus but may hurt the environment in certain scenarios. Therefore, this paper derives the optimal subsidy level by maximizing the total social welfare, which takes into account both economic and environmental performance. These findings provide valuable insights for policymakers in remanufacturing.

Providing food to the population of Kazakhstan: priorities, mechanisms

Goal - the current state and problems of development of agriculture in Kazakhstan are considered - basics of providing food to the population of the republic and development of recommendations for improving agricultural policy. Methods – systematic approach, abstract-logical, monographic, economic-statistical. Results - the authors note that the Republic of Kazakhstan ranks 32nd in the Global Food Security Index for 2022. The country has sufficient natural resources to strengthen agri-food sector, and there is the necessary level of physical availability of food products. At the same time, the share of consumer spending on food products exceeds 50%, which indicates a relatively low degree of economic accessibility of food products. The republic is directly dependent on imports of beef, pork, poultry, fish, seafood, vegetable oils, sugar and chocolate. Dairy products are uncompetitive in comparison with similar Russian and Belarusian products, which leads to significant volumes of imports. Positive results of the functioning of agro-industrial complex of Kazakhstan include exceeding gross grain harvest of the threshold level of food self-sufficiency. Conclusions – recommendations prepared as part of the study are aimed at further spreading agricultural cooperation in livestock and crop production, implementing the import substitution policy in agricultural sector, increasing profitability of small and medium-sized agricultural enterprises, improving domestic technological and resource base, and living conditions in rural areas. Improving food security will be possible if there are effective measures of support from the state for agricultural producers, which implies necessary level of subsidies, reimbursement of capital costs, preferential lending, and provision of targeted financial assistance.