Evaluation of investment subsidies - When is deadweight effect zero?
Abstract
In the evaluation of investment subsidies one of the critical issues concerns the assessment of deadweight, that is, the degree to which projects would have been carried out without grant assistance. With the increasing restrictions on and cuts in subsidies for investment projects in the EU countries maximisation of the impact of the public resources that remain can be achieved through their allocation for projects with minimum deadweight. This paper studies the profile of subsidised zero deadweight investment projects – projects that would be abandoned without public subsidies – in Finland. The empirical analysis is conducted using micro level data on investment projects by private sector firms. The data set comprises 3,423 projects that were granted public investment subsidies between 2001 and 2003. Our results show that the likelihood of zero deadweight is significantly dependent on the characteristics of the subsidised firm, the characteristics of the investment project and the location of the subsidised firm.
Main Authors
Format
Articles
Research article
Published
2008
Series
Subjects
Publication in research information system
Publisher
Taylor & Francis
The permanent address of the publication
https://urn.fi/URN:NBN:fi:jyu-201205161665Käytä tätä linkitykseen.
Review status
Peer reviewed
ISSN
0269-2171
DOI
https://doi.org/10.1080/02692170802287631
Language
English
Published in
International Review of Applied Economics
Citation
- Tokila, A., Haapanen, M., & Ritsilä, J. (2008). Evaluation of investment subsidies - When is deadweight effect zero?. International Review of Applied Economics, 22(5), 585-600. https://doi.org/10.1080/02692170802287631
License
Copyright© 2008 Taylor & Francis. This is an electronic final draft version of an article whose final and definitive form has been published in International Review of Applied Economics by Taylor & Francis.