COMPETE was a programme under the EU 2007-2013 framework that aimed to foster firms’ investment in technology, innovation, qualification and internationalisation. Using data on applications to COMPETE, it is possible to contrast the performance of firms that received funding with that of comparable firms that were unsuccessful in their bids.

Firms supported by COMPETE show, after receiving the funding, higher levels of employment, turnover, value added, productivity, capital and exports than firms whose applications were rejected. For most variables, the effects persist for several years. The impact on employment is especially large and long-lasting. Three years after the approval, employment is on average 15.7% higher in beneficiary firms than in their counterparts whose projects were rejected. The favourable effect of EU funds on employment is in line with evidence for other countries and with the programme’s focus on job creation.

For more details, see Cabral and Campos (2023), "European funds and the performance of Portuguese firms", Economic Studies, Banco de Portugal, vol. IX, no. 1, pp. 3-24.

Prepared by Sónia Cabral and Maria Manuel Campos. The analyses, opinions and findings expressed above represent the views of the authors and not necessarily those of Banco de Portugal or the Eurosystem.

If you want to receive an e-mail whenever a new “Economics in a picture” is published send your request to info@bportugal.pt.