Abstract
Public support to firm-level investments in innovation is one of the main mechanisms through which the European Union promotes socioeconomic convergence among regions and the creation of quality jobs is considered a necessary condition for the convergence of disadvantaged regional economies. This paper exploits the availability of natural experiment conditions and linked employer-employee microdata in Portugal to offer empirical evidence on the impact on relevant job-quality outcomes of a large EU-cohesion-policy program to support SMEs’ innovation investments. The analysis is implemented by means of stratification/coarsened exact matching model, combined with a difference in difference scheme, suitable to the specific impact identification conditions. Our results indicate that the policy intervention in Portugal had a positive impact on job-quality outcomes, with each supported firm generating an average of 4.9 additional standard-working-time jobs, +2.9 skilled jobs, and +2.0 permanent-contract jobs, compared to a counterfactual scenario of no public support. These impacts were at a cost of about 16,100€, 27,100€ and 39,400€ in public subsidies per additional job, respectively. We also estimate that the program impact was responsible for a 2.20€ (+17.8%) increase of the per-hour remuneration.
| Original language | English |
|---|---|
| Article number | ARTN 0193841X221074765 |
| Pages (from-to) | 626-651 |
| Number of pages | 26 |
| Journal | Evaluation Review |
| Volume | 46 |
| Issue number | 5 |
| Early online date | 2022 |
| DOIs | |
| Publication status | Published - Oct 2022 |
JEL classifications
- o31 - Innovation and Invention: Processes and Incentives