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GRANT EQUIVALENT EXPENDITURE ON INDUSTRIAL SUBSIDIES IN THE POST‐WAR UNITED KINGDOM
Author(s) -
Wren Colin
Publication year - 1996
Publication title -
oxford bulletin of economics and statistics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.131
H-Index - 73
eISSN - 1468-0084
pISSN - 0305-9049
DOI - 10.1111/j.1468-0084.1996.mp58002007.x
Subject(s) - subsidy , economics , incentive , position (finance) , government (linguistics) , investment (military) , payment , distributive property , public economics , macroeconomics , politics , finance , political science , microeconomics , market economy , linguistics , philosophy , mathematics , pure mathematics , law
The paper constructs a consistent series for UK central government expenditure on industrial subsidies over the post‐war period, valuing incentives in grant equivalent terms from the position of a firm undertaking investment appraisal. The analysis includes direct subsidy payments, as well as tax allowances, and provides a disaggregation between those subsidies available on a national, regional and sectoral or firm specific basis. A time‐series analysis of the assembled data shows important differences between these components, with regional assistance performing a long‐run distributive role, while other elements perform a stabilisation function. The short‐run patterns are broadly constant across governments, but the long‐run relationships exhibit structural breaks related to both political and economic events.