Coordination of export policy and competition policy under the background of Chinese supply side reform

Nov. 14,2019
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By the construction of a game theory model under the framework of vertical related markets under the background of Chinese supply-side reform, this paper studied the substitutability between the export tariff policy and competition policy of the exporting of strategic resources goods. It comes to the results as follows: firstly, when the government imposes export tariffs on the strategic resources goods, with export tariffs decreasing, government can implement easing competition policy to replace export tariff in order to decrease the number of enterprises in the intermediate input industry; secondly, when government collects environmental tax, with the intensity of environmental tax increasing, government can use strict policy to expand the number of enterprises in the intermediate input industry; thirdly, when the capacity of intermediate goods markets is smaller or the environment damage caused by intermediate goods is smaller, competition policy can replace export tariff policy and environmental policy more easily. This paper shows that under the background of phasing out rare earth export tariff and the poor enforcement of environmental policy, the easing competition policy which the Chinese government uses fits the demand of the healthy development of rare earth industry. In the future, with the intensity of environmental policy strengthening, the Chinese government could implement more strict competition policy gradually in strategic resources industry such as rare earth industry since implementing competition policy is the internal requirement of the supply-side reform.

Corresponding Author: HE Huanlang
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CNKI Press Officer: ZHONG Ming
Email: zm6946@cnki.net

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