Direct, spillover and welfare effects of regional firm subsidies


Siegloch, Sebastian ; Wehrhöfer, Nils ; Etzel, Tobias


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URL: https://madoc.bib.uni-mannheim.de/60137
URN: urn:nbn:de:bsz:180-madoc-601372
Document Type: Working paper
Year of publication: 2021
The title of a journal, publication series: ZEW Discussion Papers
Volume: 21-038
Place of publication: Mannheim
Publication language: English
Institution: School of Law and Economics > VWL, Soziale Sicherung (Siegloch 2018-)
Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Classification: JEL: H24 , J21 , J23,
Keywords (English): place-based policies , employment , spillovers , administrative microdata
Abstract: We analyze the effects of a large place-based policy, subsidizing up to 50% of investment costs of manufacturing firms in East Germany after reunification. We show that a 1-percentage-point decrease in the subsidy rate leads to a 1% decrease in manufacturing employment. We document important spillovers for untreated sectors in treated counties, untreated counties connected via trade and local taxes, whereas we do not find spillovers on counties in the same local labor market. We show that the policy is at least as efficient as cash transfers to the unemployed, but is more effective in curbing regional inequality.

Dieser Eintrag ist Teil der Universitätsbibliographie.

Das Dokument wird vom Publikationsserver der Universitätsbibliothek Mannheim bereitgestellt.




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