The Global Crisis and the Subsidies to Manufacturing Firms

Open access


The 2008-2009 global crisis has severely affected the world economy. Most national governments utilized fiscal policy measures including subsidies to reinforce and sustain their economies. In this study we examine the impact of the 2008-2009 global crisis on subsidies paid to manufacturing firms either by their governments or the European Union (i.e. EU). Our results indicate that, overall, a significantly larger proportion of firms had received subsidies after the global crisis. When we look into different subgroups, we find that firm size, female ownership, female management, and quality certification did not matter (more firms in all of these subgroups had received subsidies). On the other hand, our results demonstrate that firm type and top manager’s experience level made a difference in terms of subsidies received after the crisis.

If the inline PDF is not rendering correctly, you can download the PDF file here.

  • Aristei D. Sterlacchini A. and Venturini F. (2015) Effectiveness of R&D subsidies during the crisis: Firm level evidence across EU countries Economics of Innovation and New Technology Vol. 26 No. 6 pp. 554-573.

  • Becker B. (2015) Public R&D policies and private R&D investment: A survey of the empirical evidence Journal of Economic Surveys Vol. 29 no. 5 pp. 917–942.

  • Brown M. Ongena S. Popov A. and Yeşin P. (2011) Who needs credit and who gets credit in Eastern Europe? Economic Policy Vol. 26 no. 65 pp. 93–130.

  • Brautzsch H.-U. Günther J. Loose B. Ludwig U. and Nulsch N. (2015) Can R&D subsidies counteract the economic crisis? – Macroeconomic effects in Germany Research Policy Vol. 44 no. 3 pp. 623–633.

  • Capron H. and Van Pottelsberghe B. (1997) Public support to business R&D: a survey and some new quantitative evidence in: OECD Policy evaluation in innovation and technology. Towards best practices. Paris: Organisation for Economic Cooperation and Development pp. 171–188.

  • Cavusgil S.T. Knight G. and Riesenberger J. (2012) International business: New realities (3rd edition). Pearson.

  • Cucculelli M. and Bettinelli C. (2016) Corporate governance in family firms learning and reaction to recession: Evidence from Italy Futures Vol. 75 pp. 92–103.

  • David P.A. Hall B.H. and Toole A.A. (2000) Is public R&D a complement or substitute for private R&D? A review of the econometric evidence. Research Policy Vol. 29 no. 4 pp. 497–529.

  • García-Quevedo J. (2004) Do public subsidies complement business R&D? A meta-analysis of the econometric evidence Kyklos Vol. 57 no. 1 pp. 87–102.

  • González X. and Pazó C. (2008) Do public subsidies stimulate private R&D spending? Research Policy Vol. 37 no. 3 pp. 371–389.

  • Mateut S. (2018) Subsidies financial constraints and firm innovative activities in emerging economies Small Business Economics Vol. 50 no. 1 pp. 131-162.

  • Uchitelle L. (2018) The case for manufacturing subsidies Challenge Vol. 61 no. 1 pp. 56-67.

  • Yunlu D.G. and Murphy D.D. (2012) R&D intensity and economic recession: Investigating the moderating role of CEO characteristics Journal of Leadership & Organizational Studies Vol. 19 no. 3 pp. 284-293.

  • Zuniga-Vicente J.A. Alonso-Borrego C. Forcadell F.J. and Galan J.I. (2014) Assessing the effect of public subsidies on firm R&D investment: A survey Journal of Economic Surveys Vol. 28 no. 1 pp. 36–67.