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Does State Aid Create Jobs? The Short and Mid-Term Employment Effects of Subsidies

Caroline Buts, Marc Jegers

DOI https://doi.org/10.21552/ESTAL/2013/4/382



This article looks at the aggregate effect of subsidies to Belgian firms on their levels of employment. It appears that firms receiving high subsidies experience a significantly higher increase in employment (FTE) than firms not receiving subsidies. This effect becomes visible about two years after the subsidies have been granted. This result sheds a more positive light on the employment effects of State aid than most of the previous studies focusing solely on aid mea

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