The Effects of Subsidies on MSW Treatment Companies: Financial Performance and Policy Implications

Eleonora Santos and Inês Lisboa
Additional contact information
Eleonora Santos: Centre of Applied Research in Management and Economics, Polytechnic Institute of Leiria, 2411-901 Leiria, Portugal
Inês Lisboa: Centre of Applied Research in Management and Economics, Polytechnic Institute of Leiria, 2411-901 Leiria, Portugal

Sustainability, 2022, vol. 14, issue 5, 1-22

Abstract: Companies that provide public services usually receive subsidies from municipalities as compensation for replacing the latter in their functions as public service providers. However, the managers of those companies are not always interested in maintaining an economically sustainable company, as this implies turning off the tap on exploration subsidies. This article investigates the effect of subsidies on the financial performance of municipal solid waste collection and treatment companies for 2016–2020 and across NUTS II regions. The accounting data of 680 companies retrieved from the SABI database, make it possible to assess the economic sustainability of the companies through financial ratios and operational data. The results show that the financial structure and management of companies in the Centro, Lisbon, and the Azores allowed to take advantage of exploration subsidies to achieve economic sustainability. In the remaining regions these subsidies proved to be ineffective. These results have implications for managers and policy makers insofar as it sheds a light on the conditions under which subsidies contribute to the economical sustainability of companies in the sector.

Keywords: economic sustainability; financial performance; MSW; subsidies (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2071-1050/14/5/3076/pdf (application/pdf)
https://www.mdpi.com/2071-1050/14/5/3076/ (text/html)

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:gam:jsusta:v:14:y:2022:i:5:p:3076-:d:765408

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().