IESET.
Hypotheses·growth·subsidy_duration_declining_returns_panel

Industrial subsidies have positive early output effects but declining or negative productivity effects when maintained beyond 10 years in a broad panel of advanced and emerging economies during 1970-2020.

INCONCLUSIVEengine/runs/subsidy_duration_declining_returns_panel

INCONCLUSIVE_DATA_PENDING — treatment 'subsidy_duration' has no within-country variation under country fixed effects

confidence cueResult card produced; verdict unclassified.

policy briefCoverage too thin

In ordinary language

Over a long period, do more market-oriented institutions translate into higher income or productivity, once the comparison looks beyond a single success story?

plain answer

This test cannot make a firm call yet. treatment 'subsidy_duration' has no within-country variation under country fixed effects

why it matters

Growth claims can look convincing in single success stories. This test asks whether the pattern survives a broader comparison.

how the test works

It compares 35 country or place units from 1970 to 2020, using a panel fe design, with fixed effects for country and year.

what was measured
What changed
  • Subsidy duration
  • Subsidy intensity
What we checked
  • Output growth
  • Total factor productivity growth
  • Sectoral va growth
what this does not prove

A single test is not the whole truth. It narrows the claim under a specific sample, time period, and method. Strong policy conclusions need the pattern to survive nearby tests, alternative data, and serious objections.

verification

No evidence packet has been generated yet.

Results

engine/runs/subsidy_duration_declining_returns_panel
1007550250197019952020USADEUFRAGBRJPNAUSCAN
illustrative sketch · run pending
No coefficients yet. When the model fires, this chart will show output_growth across 35 sampled countries over 1970–2020.
The shapes above are stylised — none of the lines are real data.
Placeholder for subsidy_duration_declining_returns_panel. Published chart will be generated from engine/runs/subsidy_duration_declining_returns_panel/chart_data.json.

Pre-registration

pre-registered
first-spec commit 5ce4495 · 2026-05-02T19:11:20Z
run generated · 2026-06-29T17:53:03Z

Industrial subsidies have positive early output effects but declining or negative productivity effects when maintained beyond 10 years in a broad panel of advanced and emerging economies during 1970-2020.

Falsification criterion — what would disprove this

set before the run · honoured after

This hypothesis is considered falsified if:

Falsified if the coefficient on subsidy duration-squared in a TFP growth regression is not negative and statistically significant, or if subsidies maintained beyond 10 years show no productivity decline relative to unsubsidised sectors.

formal test & threshold
test:      panel_fe_quadratic_subsidy_duration
threshold: [object Object]

Method

Template
panel_fe
Fixed effects
country, year
Clustering
country
Sample
35 countries · 1970 – 2020
Evidence type
causal

Panel FE with quadratic term in subsidy duration to test for declining returns. Robustness via event-study around subsidy programme starts and ends.

Data

VariableSourceTransform
output_growth
outcome
world_bank_wdi:NY.GDP.MKTP.KD.ZGtier 2
annual_pct
total_factor_productivity_growth
outcome
pwt:rtfpnatier 3
annual_pct
sectoral_va_growth
outcome
oecd_stan:value_added_by_sectortier 5
annual_pct
subsidy_duration
treatment
constructed:years_since_subsidy_programme_inceptiontier 5
continuous
subsidy_intensity
treatment
constructed:subsidies_pct_gdp_or_sector_vatier 5
level_pct
initial_income
control
maddison:mpd2020tier 3
log_level
sectoral_composition
control
world_bank_wdi:NV.IND.MANF.ZStier 2
level_pct
trade_openness
control
world_bank_wdi:NE.TRD.GNFS.ZStier 2
level

● ready  · ● pending  · ● reconstruct-needed

Detailed result card

Result card — subsidy_duration_declining_returns_panel

Verdict: INCONCLUSIVE_DATA_PENDING — treatment 'subsidy_duration' has no within-country variation under country fixed effects

Pre-registration

  • Claim: Industrial subsidies have positive early output effects but declining or negative productivity effects when maintained beyond 10 years in a broad panel of advanced and emerging economies during 1970-2020.
  • Falsification rule: Falsified if the coefficient on subsidy duration-squared in a TFP growth regression is not negative and statistically significant, or if subsidies maintained beyond 10 years show no productivity decline relative to unsubsidised sectors.
  • Falsification test: panel_fe_quadratic_subsidy_duration

Estimate

  • Error: treatment 'subsidy_duration' has no within-country variation under country fixed effects

Variables resolved

  • world_bank_wdi:NY.GDP.MKTP.KD.ZG → output_growth (outcome, publisher=world_bank_wdi, n=13897)
  • pwt:rtfpna → total_factor_productivity_growth (outcome, publisher=pwt, n=6407)
  • constructed:years_since_subsidy_programme_inception → subsidy_duration (treatment, publisher=constructed, n=1785)
  • maddison:mpd2020 → initial_income (controls, publisher=maddison, n=19706)
  • world_bank_wdi:NV.IND.MANF.ZS → sectoral_composition (controls, publisher=world_bank_wdi, n=9698)
  • world_bank_wdi:NE.TRD.GNFS.ZS → trade_openness (controls, publisher=world_bank_wdi, n=10714)

Variables missing data

  • oecd_stan:value_added_by_sector (outcome, name=sectoral_va_growth) — vintage not on disk
  • constructed:subsidies_pct_gdp_or_sector_va (treatment, name=subsidy_intensity) — vintage not on disk

Generated by scripts/run_panel_fe.py at 2026-06-29T17:53:03+00:00

Strongest opposing argument

Every hypothesis ships with its charitable opposing argument. The framework earns credibility by handling objections at their strongest, not weakest.

Notes

Subsidy data from OECD STI, WTO notifications, national budget documents, and Klier and Linn (2010) auto-sector databases. Duration coding requires manual programme tracing.

Authored framework. Read the transparency note.