Design for Impact : A State Aid Evaluation in Romania
State aid impact evaluation is new in Romania. Given its novelty, the ex post evaluation seeks to provide evidence on how effective state aid has been, on whether state aid distorted competition, and on the implications for state aid design and implementation. These aspects are fundamental to im...
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| Format: | Book |
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Washington, DC: World Bank
2021
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| Online Access: | https://documents.worldbank.org/en/publication/documents-reports/documentdetail/413841623646945259/design-for-impact-a-state-aid-evaluation-in-romania http://hdl.handle.net/10986/35738 |
| Summary: | State aid impact evaluation is new in Romania. Given its novelty,
the ex post evaluation seeks to provide evidence on how effective
state aid has been, on whether state aid distorted competition, and on
the implications for state aid design and implementation. These aspects
are fundamental to improving the efficiency of public spending and
minimizing market distortions. The ex post evaluation focuses on three
state aid schemes to assess whether and to what extent the aid objectives
have been fulfilled, and it measures their spillover effects as well as the
effects on competition outcomes. Selected based on the their importance
in supporting key policy objectives, their design and complexity, and the
instruments used, the three schemes include de minimis aid implemented
by the Romanian Counter-Guarantee Fund and designed to incentivize
access to finance for micro, small, and medium enterprises (MSMEs);
state aid granted by the Ministry of Public Finance to support regional
development and job creation; and state aid provided by the Ministry of
European Funds to support the upgrade and modernization of research,
development, and innovation. The analysis finds evidence that the
state aid schemes met their objectives without distorting competition
significantly. The results for the de minimis scheme to incentivize access to
finance for micro, small, and medium enterprises showed that the scheme
increased employment and turnover of beneficiary firms and reduced
the probability of aided firms closing. The state aid scheme to support
regional development and job creation fulfilled its main objectives, with
robust evidence of a positive direct effect on employment creation and,
to some extent, on investment. Regarding the state aid scheme to support
the upgrade and modernization of research, development, and innovation,
the analysis found evidence that the scheme helped promote research and
development efforts. |
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