IDEAS home Printed from https://ideas.repec.org/a/taf/irapec/v22y2008i5p585-600.html
   My bibliography  Save this article

Evaluation of investment subsidies: when is deadweight zero?

Author

Listed:
  • Anu Tokila
  • Mika Haapanen
  • Jari Ritsila

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.

Suggested Citation

  • Anu Tokila & Mika Haapanen & Jari Ritsila, 2008. "Evaluation of investment subsidies: when is deadweight zero?," International Review of Applied Economics, Taylor & Francis Journals, vol. 22(5), pages 585-600.
    • Handle: RePEc:taf:irapec:v:22:y:2008:i:5:p:585-600
    DOI: 10.1080/02692170802287631
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/02692170802287631
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/02692170802287631?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Catherine Laffineur & Saulo Dubard Barbosa & Alain Fayolle & Emeran Nziali, 2017. "Active labor market programs’ effects on entrepreneurship and unemployment," Small Business Economics, Springer, vol. 49(4), pages 889-918, December.
    2. Marco Caliendo & Jens Hogenacker & Steffen Künn & Frank Wießner, 2015. "Subsidized start-ups out of unemployment: a comparison to regular business start-ups," Small Business Economics, Springer, vol. 45(1), pages 165-190, June.
    3. Caliendo, Marco & Künn, Steffen & Weißenberger, Martin, 2016. "Personality traits and the evaluation of start-up subsidies," European Economic Review, Elsevier, vol. 86(C), pages 87-108.
    4. Mamedov, Arseny (Мамедов, Арсений) & Hudko, E. (Худько, Е.) & Belev, Sergei (Белев, Сергей) & Moguchev, Nikita Sergeevich (Могучев, Никита Сергеевич), 2016. "Comparative Analysis of the Effectiveness of Individual Instruments of State Investment Policy [Сравнительный Анализ Эффективности Применения Отдельных Инструментов Государственной Инвестиционной П," Working Papers 3052, Russian Presidential Academy of National Economy and Public Administration.
    5. Carboni, Oliviero A., 2017. "The effect of public support on investment and R&D: An empirical evaluation on European manufacturing firms," Technological Forecasting and Social Change, Elsevier, vol. 117(C), pages 282-295.
    6. Simona Bratkova & Miroslav Sipikal & Valeria Nemethova, 2021. "Impact of Deadweight Effect on the Performance of Supported Firms," RAIS Conference Proceedings 2021 0014, Research Association for Interdisciplinary Studies.
    7. José Luis Crespo-Espert & Antonio García-Tabuenca & Federico Pablo-Martí, 2012. "Women, entrepreneurial activity and territory: differences or myths?," Chapters, in: Charlie Karlsson & Börje Johansson & Roger R. Stough (ed.), Entrepreneurship, Social Capital and Governance, chapter 6, pages 115-159, Edward Elgar Publishing.
    8. Frantisek TURNOVEC, 2009. "Council, Commission and European Parliament Influence in European Union Decision Making," EcoMod2009 21500089, EcoMod.
    9. Reiljan, Janno & Paltser, Ingra, 2013. "The implementation of research and development policy in European and Asian countries," Discourses in Social Market Economy 2013-03, OrdnungsPolitisches Portal (OPO).
    10. Antonio Garcia-Tabuenca & Jose Crespo-Espert, 2010. "Credit guarantees and SME efficiency," Small Business Economics, Springer, vol. 35(1), pages 113-128, July.
    11. Anu Tokila & Mika Haapanen, 2009. "Evaluating Project Deadweight Measures: Evidence from Finnish Business Subsidies," Environment and Planning C, , vol. 27(1), pages 124-140, February.
    12. Anabela Santos & Michele Cincera & Paulo Neto & Maria Manuel Serrano, 2019. "How internationalization and competitiveness contribute to get public support to innovation? The Portuguese case," GEE Papers 0121, Gabinete de Estratégia e Estudos, Ministério da Economia, revised May 2019.
    13. Berumen, Sergio A., 2012. "Evaluación del impacto de la política de incentivos sectoriales en el desarrollo de los municipios mineros de Castilla y León," Journal of Economics, Finance and Administrative Science, Universidad ESAN, vol. 17(33), pages 15-30.
    14. Anabela Santos & Michele Cincera & Paulo Neto & Maria Manuel Serrano, 2019. "Which projects are selected for an innovation subsidy? The Portuguese case," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 18(3), pages 165-202, October.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:irapec:v:22:y:2008:i:5:p:585-600. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CIRA20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.