Can the Reform of “Streamline Administration and Delegate Power, Improve Regulation, and Optimize Services” Help Drive Export Diversification of Wood-Processing Enterprises?

The Chinese government has often been suspected of excessively intervening in the market. The reform of “Streamline Administration and Delegate Power, Improve Regulation, and Optimize Services” (RSDO) is a key initiative by the Chinese government to help enterprises improve their international competitive advantage through institutional reforms. Few studies have empirically tested the effects of RSDO on enterprises’ export diversification. Using the data of 2141 wood-processing enterprises (WPEs) in China in 2014, this study applies zero-truncated negative binomial regression and the Tobit model to evaluate the effects of prefecture-level RSDO on enterprises’ export product and market diversification. The results show that the RSDO can enhance WPEs’ export product diversification without significantly impacting export market diversification. Regarding specific indicators, the reforms of “Streamline Administration and Delegate Power” and “Improve Regulation” significantly positively affect export product and market diversification. In contrast, the optimization of government services shows no significant impact. Heterogeneity tests show that the RSDO promotes export diversification in wooden products and furniture manufacturing enterprises, smaller enterprises, domestic enterprises, and those with weaker operational capabilities. The impact mechanism shows that the RSDO aids sample enterprises in enhancing export product diversification by lowering operational costs and supports export market diversification by encouraging technological innovation.