Converting the intercepts on either side of the threshold from logs into levels implies that binding vessels just above their nearest gross tonnage threshold receive about $10,000 more in fuel subsidy per month than binding vessels just below their nearest gross tonnage threshold (approximately $24,000 per month compared to $14,000 per month). The elasticity of fishing hours with respect to fuel subsidy received is 2.177 (Column 3). While the conventional first stage and elasticity estimates are large in magnitude, neither are statistically different from zero when we apply our randomization inference procedure. The randomization inference p-values are 0.187 and 0.101 (Figure A5), compared to conventional p-values of 4 _×_ 10<sup>_−_7</sup> and 0.0004. We therefore view these estimates as suggestive evidence that the elasticity of fishing with respect to fuel subsidies may be large, perhaps even larger than 1 (conventional p-value = 0.029). Our estimates could be imprecise because we estimate fuel subsidies with different transponder data than the regulator uses in assigning subsidies (Section 2).<sup>22</sup> We use a similar procedure to estimate the elasticity of distance traveled with respect to fuel subsidy received. Columns 4 to 6 of Table 4 display the reduced form, first stage, and elasticity estimates. As in Column 3 of Table 3, we apply the optimal bandwidth from when log fishing hours was the dependent variable (to ensure comparability). There are more observations than when we estimate the fishing hours elasticity because of vesselmonths with positive distance traveled and subsidy received but with zero fishing hours. The two first stage estimates differ for this reason.<sup>23</sup> The first stage is more precise in this specification (conventional p-value is 5 _×_ 10<sup>_−_7</sup> and randomization inference p-value is 0.057). We find that the elasticity of distance traveled with respect to fuel subsidy received is 1.746.

> 22Mismeasurement of subsidy days would bias our first stage and elasticity estimates if we differentially mismeasure subsidy days with respect to gross tonnage thresholds. We compare official subsidy days for 273 vessels from Putuo district, Zhoushan in Zhejiang province (see (Figure A1(a)) with our estimate of subsidy days using a t-test. We do not find evidence of differential mismeasurement. Vessels above their nearest gross tonnage threshold have a mean difference between official and estimated subsidy days of -13, while vessels below their nearest gross tonnage threshold have a mean difference of -9 (p-value = 0.625). As a point of comparison for interpreting the magnitude of these differences, the mean official subsidy days is 304. We report results from a t-test because re-estimating Equation 2 with these data results in an error, likely due to the small sample size.

23The reduced form coefficient differs slightly from the estimate in Column 3 of Table 3 for a similar reason. GFW calculates distance traveled from non-public, vessel movement point data. We use the public version of GFW’s AIS data when allocating subsidies to the monthly level. Due to the log transformation of the dependent variables, to remain in the data used to estimate Columns 4 to 6 of Table 4, the vessel-month-year must have positive distance traveled in the non-public data and positive AIS hours in the public data. Only the first condition must be true to remain in the data used to estimate Column 3 of Table 3.

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