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Vliv dotace na konkurenceschopnost podniku - předběžná analýza
[Subsidy Effect on Enterprise Competitiveness - Preliminary Analysis]

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  • Milan Sedláček

Abstract

More than EUR 347 million from EU funds was allocated for boosting competitiveness of Czech economy during the time period from 2004 to 2006. The aim of this paper is to evaluate effects of subsidies from programme "Development", which was focused on rising small and medium company competitiveness. Method Benchmark and method Per se were created for this purpose. Analyses confirm that subsidies are drawn by companies with above average rate of competitiveness. On the other hand, competitiveness of these subsidised companies (measured by eight financial indicators) was ostensibly decreasing after drawing the subsidy. The cause for this fact can be found in Czech accounting legislation which creates a dilemma for company managers. Research results show that managers of subsidized companies have probably chosen conservative strategy - the above average EBIT (created thanks to the subsidy) hold in liquid assets and use it for necessary future reinvestment but formally worsen profi tability ratios.

Suggested Citation

  • Milan Sedláček, 2015. "Vliv dotace na konkurenceschopnost podniku - předběžná analýza [Subsidy Effect on Enterprise Competitiveness - Preliminary Analysis]," Politická ekonomie, Prague University of Economics and Business, vol. 2015(4), pages 474-497.
    • Handle: RePEc:prg:jnlpol:v:2015:y:2015:i:4:id:1031:p:474-497
    DOI: 10.18267/j.polek.1031
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    References listed on IDEAS

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    1. Inka Neumaierová & Ivan Neumaier, 2014. "INFA Performance Indicator Diagnostic System," Central European Business Review, Prague University of Economics and Business, vol. 2014(1), pages 35-41.
    2. Clausen, Tommy H., 2009. "Do subsidies have positive impacts on R&D and innovation activities at the firm level?," Structural Change and Economic Dynamics, Elsevier, vol. 20(4), pages 239-253, December.
    3. Man, Thomas W. Y. & Lau, Theresa & Chan, K. F., 2002. "The competitiveness of small and medium enterprises: A conceptualization with focus on entrepreneurial competencies," Journal of Business Venturing, Elsevier, vol. 17(2), pages 123-142, March.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    investment; competitiveness; subsidy; evaluation; company performance; financial analysis;
    All these keywords.

    JEL classification:

    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • M20 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - General
    • M48 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Government Policy and Regulation
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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