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China Finance and Economic Review

Table 5 Baseline effects of ITC and TID on activities of taxpayers

From: Tax incentives and environmental protection: evidence from China’s taxpayer-level data

Dependent variable: weighted growth in Eq. (2)

Net investment

Employment

Coal inputs

Output

Independent variables

(1)

(2)

(3)

(4)

(5)

(6)

(7)

(8)

Part A

 Lagged ITCdummy

−0.430* (0.228)

−0.410* (0.226)

−0.007 (0.026)

−0.009 (0.026)

0.404** (0.199)

0.407** (0.204)

0.020 (0.053)

0.034 (0.053)

 Lagged TIDdummy

0.215 (0.476)

0.171 (0.516)

0.017 (0.088)

0.031 (0.088)

−0.330 (0.442)

−0.360 (0.442)

−0.162 (0.195)

−0.135 (0.200)

 Taxpayer-level control variables

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

 Industry-level control variables

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

 Taxpayer fixed effect

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

 Year fixed effect

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

 Province and province-year fixed effect

Yes

No

Yes

No

Yes

No

Yes

No

 Industry and industry-year fixed effect

No

Yes

No

Yes

No

Yes

No

Yes

 Within R-square

0.021

0.014

0.546

0.548

0.044

0.038

0.522

0.519

 Observation

16584

16584

20907

20907

13821

13821

20810

20810

Part B

 lagged ITCterm

0.149 (0.558)

0.114 (0.575)

0.090 (0.069)

0.108 (0.068)

−1.437** (0.683)

−1.305** (0.636)

−0.080 (0.152)

−0.073 (0.155)

 Lagged TIDterm

−0.284 (0.446)

−0.273 (0.432)

0.078 (0.132)

0.083 (0.125)

0.911 (0.720)

0.952 (0.743)

0.358* (0.199)

0.344* (0.176)

 Taxpayer-level control variables

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

 Industry-level control variables

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

 Taxpayer fixed effect

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

 Year fixed effect

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

 Province and province-year fixed effect

Yes

No

Yes

No

Yes

No

Yes

No

 Industry and industry-year fixed effect

No

Yes

No

Yes

No

Yes

No

Yes

 Within R-square

0.021

0.014

0.551

0.552

0.044

0.040

0.524

0.522

 Observation

15953

15953

20070

20070

13207

13207

19976

19976

  1. Notes: Superscript symbols "*, ** and ***" represent 10 %, 5 %, and 1 % significant level respectively. The coefficients in Italics should be emphasized for they indicate that the tax incentives stimulate coal consumption. In all columns, we use the specification in Eq. (2), and residuals are clustered at province-industry level. Taxpayer-level control variables include ownership, age, size, ROA, wage, capacity, import, and output, and we use their pretreatment or 1-year lagged values. Industry-level characteristics include county-industry average wage ratio and agglomeration of industry, and we use their current values. For other notes, see Tables 3 and 4
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