Accelerated depreciation tax policy and multiple-product firms' export behaviour: evidence from China

Using the 2014 accelerated depreciation tax policy (ADP) in China as a quasi-natural experiment, this study examines ADP's impact on multiple-product firms' export behaviour. Using data on Chinese A-share listed multiple-product companies from 2011 to 2016, we find that ADP enhances export product quality and reduces the unit price of export products by increasing enterprise innovation, accelerating 'machine replacing labours', and realizing the 'economies of scale effect'. Notably, these effects are pronounced in cost-based competence firm. These findings provide developing countries with insights into the use of ADP to encourage high-quality export development.