Bridging the gap in innovation: the case of regional R&D subsidies in Southern Italy

Antonio Veronico ()
Additional contact information
Antonio Veronico: Bank of Italy

No 1526, Temi di discussione (Economic working papers) from Bank of Italy, Economic Research and International Relations Area

Abstract: This paper estimates the causal impact of a regional R&D subsidy funded with EU cohesion funds in favour of small and medium firms operating in Puglia, a region in Southern Italy that has historically lagged behind. I leverage firms' balance sheets and a unique regional administrative dataset on subsidy payments to study how this policy affected the R&D investments, productivity, and survival probability of recipients. By adopting a recently developed match-in-diff approach and using a control group of eligible but unsubsidized firms, I first show that the treated firms display higher survival compared with control firms. Then, I find that the policy was successful in stimulating additional investments in intangible assets. The policy also had positive effects on the number of workers employed in the treated firms. However, I do not find any impact on tangible assets, value of production, and productivity.

Keywords: placed-based policy; R&D subsidy; EU funds; match-in-diff (search for similar items in EconPapers)
JEL-codes: C21 H25 H32 L25 L53 O31 O33 O38 R11 R58 (search for similar items in EconPapers)
Date: 2026-04
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.bancaditalia.it/pubblicazioni/temi-dis ... 526/en_tema_1526.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bdi:wptemi:td_1526_26

Access Statistics for this paper

More papers in Temi di discussione (Economic working papers) from Bank of Italy, Economic Research and International Relations Area Contact information at EDIRC.
Bibliographic data for series maintained by ().