Quotations IWH: No shortenings of complex facts - but putting things in a nutshell....
When there were almost no flats in Halle yet ... Brigitte Loose about IWH's...
Centre for Evidence-based Policy Advice
Centre for Evidence-based Policy Advice (IWH-CEP) ...
Brown Bag Seminar
Brown Bag Seminar Financial Markets Department The seminar series "Brown...
Members' Assembly As a membership corporation the IWH is statutably divided into...
Speed Projects On this page, you will find the IWH EXplore Speed Projects in...
Firm Subsidies, Financial Intermediation, and Bank Stability
IWH Discussion Papers,
We use granular project-level information for the largest regional economic development program in German history to study whether government subsidies to firms affect the quantity and quality of bank lending. We combine the universe of recipient firms under the Improvement of Regional Economic Structures program (GRW) with their local banks during 1998-2019. The modalities of GRW subsidies to firms are determined at the EU level. Therefore, we use it to identify bank outcomes. Banks with relationships to more subsidized firms exhibit higher lending volumes without any significant differences in bank stability. Subsidized firms, in turn, borrow more indicating that banks facilitate regional economic development policies.