DO EU GRANTS HAVE AN IMPACT ON PRIVATE PRODUCTIVITY AND EFFICIENCY? AN EMPIRICAL ANALYSIS ON ROMANIAN COMPANIES

One of the central instruments for stimulating regional economic development in the European Union is represented by investment subsidies. Theoretically, these should be very efficient, practically representing a capital injection, but the scientific literature in this field is divided. On the one hand, some of the authors who have studied this subject conclude that European funds have positive effects, supporting the economic growth of the beneficiary regions, on the other hand some authors claim that these subsidies are effective only under certain conditions, that is, they have a conditional positive effect, however there are also authors who claim that subsidies granted to private enterprises do not have notable effects on efficiency and therefore do not lead to economic growth, resulting in a waste of funds. This article represents an exploratory research of this phenomenon in Romania, the scientific literature on this subject being focused more on macroeconomic, econometric analyses than on microeconomic analyses at the firm level. In this study, we focused on a call for projects within the National Rural Development Program 2014-2020, a program financed by the European Union, and we analysed the evolution of the economic and financial situations of the firms that won and implemented projects with non-reimbursable financing, comparing the evolution of some key indicators with that of a control group. The results obtained clearly indicate that these non-reimbursable financial aids contribute to increasing the productivity and efficiency of beneficiary companies, demonstrating that at the Romanian level, European funds are efficient, generating structural changes that lead to sustainable economic growth.