[Alberta's Child]

Most of your points are correct. I'm not sure a "state-subsidized" industry has any real competitive advantage when you look at it from a macroeconomic perspective. I'm not sure it works in China's favor if their own taxpayers are forced to subsidize the production of cheap products that they can't even afford to buy themselves.

Is Boeing "state-subsidized" if they generate a lot of their revenue from U.S. defense contracts that aren't open to foreign bidders?

[ek_hornbeck]

Most of your points are correct. I'm not sure a "state-subsidized" industry has any real competitive advantage when you look at it from a macroeconomic perspective.

No, but a state-subsidized industry does enjoy a trade advantage, at least in a short-term. If a state-subsidized company can produce at cost or at a loss while being propped up by the government, it can undersell foreign competition. The advantage is political and strategic as much as it is economic.

Sometimes the overproduction gambit works, sometimes it fails. The Saudis tried flooding the oil market to put US frackers out of business, in the long run their overproduction hurt their economy more than it did ours.

[DesertRhino]

No, state subsidized is Airbus, where it was formed by a government.