Export Premiums

The following article is from The Great Soviet Encyclopedia (1979). It might be outdated or ideologically biased.

Export Premiums


financial benefits granted in capitalist countries to exporters by state bodies or monopolistic associations for the purpose of expanding the export abroad of certain goods. They were first systematically introduced at the end of the 19th century and are applied on an extensive scale in capitalist countries today.

Export premiums take the form either of payments to national exporting companies of money subsidies for the export of goods (direct export premiums) or of the granting to such companies of exemptions from internal taxes and dues (concealed export premiums). Direct export premiums enable ex-port firms to reduce their prices while maintaining their profits at a high level. Such subsidies are used in the United States for the export of agricultural products, such as cotton. Japan and the countries of Western Europe use such subsidies in the export of many kinds of finished articles, including textiles and automobiles. The volume of the export premium may amount to as much as 60 or 70 percent of the price of the article, thus enabling monopolies to engage in dumping.

Concealed (indirect) export premiums are accorded by a government to a domestic exporting firm in the form of advantageous conditions for the payment of domestic taxes, excise and customs duties, and other dues. In Western Europe, the United States, and Japan, a system of tax benefits exists for the expansion of exports: exporting monopolies are exempted from tax payments or pay only a reduced rate. The system of indirect export premiums exempts export firms from the payment of import duties (or provides for their subsequent refunding) if the export firms are using imported raw materials for the manufacturing of goods for export (the so-called conditional duty-exempt importation, or return of duties).

Export premiums are one of the ways in which monopolies use the state machinery in the struggle for foreign markets. They impose a heavy burden on the shoulders of the working masses of capitalist countries, representing as they do a method of redistribution in the interests of monopolistic capital of the share of the taxes and duties accruing to the state budget.


The Great Soviet Encyclopedia, 3rd Edition (1970-1979). © 2010 The Gale Group, Inc. All rights reserved.
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This analysis, as has been commonly done in the existing literature (Ma, Tang and Zhang 2014; Mukim 2011; Hiep and Ohta 2009), aims to derive the export premium along the basic patterns of firm characteristics and firm productivity.
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