EconStor >
Research Institute of the Finnish Economy (ETLA), Helsinki >
ETLA Discussion Papers, Research Institute of the Finnish Economy (ETLA) >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/44557
  
Title:Access to business subsidies: What explains complementarities and persistency? PDF Logo
Authors:Koski, Heli
Pajarinen, Mika
Issue Date:2010
Series/Report no.:ETLA discussion paper 1226
Abstract:Our empirical analysis using an extensive database on the allocation of busi-ness subsidies in Finland during the years 2004-2008 finds that large firms are less likely to exit support system and more likely to continue receiving both support from one organization only and simultaneous support from multiple organizations. Large firms' propensity to transit between subsidies of different organizations is also higher than that of the smaller ones. Our study detects another interesting characteristic of the Finnish business subsidy system: the existence of agency-specific loyal customers. Firm size relates positively to the probability of a firm becoming the agency-specific customer of any public support provider, while the effect of other firm-level factors on this probability varies among the agencies. In addition to this, various parts of our analysis suggest that there is also a group of firms - comprising more likely larger firms - that tends to obtain support simultaneously from at least from two different organizations over several years. This finding is, as is the existence of agency-specific loyal customers, contrary to the basic principles of business subsidy system originally designed for providing temporary aid for companies.
Subjects:public subsidies
complementarities
transitions
persistency
JEL:L53
O25
Document Type:Working Paper
Appears in Collections:ETLA Discussion Papers, Research Institute of the Finnish Economy (ETLA)

Files in This Item:
File Description SizeFormat
638997623.pdf253.24 kBAdobe PDF
No. of Downloads: Counter Stats
Download bibliographical data as: BibTeX
Share on:http://hdl.handle.net/10419/44557

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.