Wednesday, 26 February 2020 at 11.00-12.00
Amaresh Tiwari (Univeristy of Tartu), co-authors Simona Ferraro, Kadri Mänassoo, Jaan Masso, Helery Tasane
Impact Evaluation of Cohesion Fund, 2014-2020: The Case of Estonia
In this paper we study the impact of various support measures, called “Actions,” of European Union’s 2014-2020 Cohesion Policy on the firm performances of the Estonian firms who received supports through the various Actions. The firm performances considered are (a) labour productivity, (b) employment, (c) exports, and (d) financial health. The supports meted out under a particular Action can be either financial or consultancy support. The eligibility criteria for obtaining supports through various Actions differ, and Actions themselves differ in their mandates. The supports under various Actions are provided in an arbitrary manner over the four years, 2015—2018, where some Actions provide supports to varying number of firms all the years, whereas other Actions provide supports in one, two or three years to an arbitrary number of firms. Moreover, in any particular year, firms can receive multiple supports through one or more Actions. We have developed an empirical strategy to account for the confounding effects of supports from other Actions while estimating the impact of a particular Action on various measures of firm performance. It also takes care of the fact that supports through various Actions are provided in an arbitrary fashion over the years. We find that not all Actions have had the desired impact on firm performances. While a majority of actions have had a positive impact on labour productivity and financial health, almost no Action had an impact on employment. We find that financial supports have a positive impact on labour productivity in the very next period, whereas consultancy supports have a significant impact on productivity only in the later time period.