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The Selection of Investment Subsidy Beneficiaries. An Estimate of the Differences between National and Regional Policymakers Priorities

  • Leonardo Becchetti

    ()

    (University of Rome "Tor Vergata")

  • David Andrés Londoño Bedoya

    ()

    (University of Rome "Tor Vergata")

We evaluate the effects of the partial delegation of the right to select subsidy recipients from national to regional policymakers in Italy on a sample of more than 10,000 projects. We show that regional policymakers attach higher value to job creation by paying significantly more, in terms of disbursed subsidy, for any additional worker employed by financed projects. “Regional winners” are also smaller and create relatively more jobs than “national winners”. We also show that the relatively higher emphasis of regional policymakers on the creation of new plants contributes to the determination of part but not all these effects.

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Article provided by SIPI Spa in its journal Rivista di Politica Economica.

Volume (Year): 97 (2007)
Issue (Month): 2 (March-April)
Pages: 121-166

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Handle: RePEc:rpo:ripoec:v:97:y:2007:i:2:p:121-166
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