Determinants of CAP Funding Absorption for Agricultural Investments in Western Romania During the Transition Period

The research focuses on the National Rural Development Programme (NRDP) during the transition period, assessing the absorption level of sub-measure 4.1, “Investments in agricultural holdings”, which impacts rural development in the agricultural sector in western Romania. A quantitative and qualitative analysis of all selection reports associated with sub-measure 4.1 submitted during the transition period (2021–22) was conducted to investigate a potentially relevant link between the number of beneficiaries identified in the analysed region and their location. Fisher’s exact tests indicate that the null hypothesis, which postulates independence between county and measure in the observed dataset, cannot be rejected. Further empirical analysis was conducted using panel data analysis to identify any relevant regression traits. Tests indicate that funding allocation, the spatial dimension and the temporal dimension are all statistically and substantively significant. Larger budget allocations are associated with a higher volume of proposals. Two out of the four analysed counties systematically outperformed the predicted values in the model by submitting more proposals than would be expected given their budgets. Later application stages yielded a greater number of successful proposals, which is consistent with residual demand capture in sequential competitive calls.