论文题目：Zhao Chen, Zhikuo Liu, Juan Carlos Suárez Serrato & Daniel Yi Xu, 2021. Notching R&D Investment with Corporate Income Tax Cuts in China, American Economic Review, forecoming.
We study a Chinese policy that awards substantial tax cuts to ﬁrms with R&D investment over a threshold or “notch.” Quasi-experimental variation and administrative tax data show a signiﬁcant increase in reported R&D that is partly driven by ﬁrms relabeling expenses as R&D. Structural estimates show relabeling accounts for 24.2% of reported R&D and that doubling R&D would increase productivity by 9%. Policy simulations show that ﬁrm selection and relabeling determine the cost-eﬀectiveness of stimulating R&D, that notch-based policies are more eﬀective than tax credits when relabeling is prevalent, and that modest spillovers justify the program from a welfare perspective.