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The endurance and vitality of European agriculture are threatened by the aging of farmers, together with the lack of generational change. The small share of young farmers also impacts on the innovative capacity and competitiveness of the sector. The Common Agricultural Policy of the European Union started addressing the issue long ago by providing financial aid to help young farmers to start up. Over time, the aid increased and packages of measures were set to reinforce the aid and to promote investments, innovations, and networks at the farm level. While the literature focuses on analyzing the effectiveness of the start-up aid in fostering new entries, this paper assumes an original perspective as it seeks to assess whether this aid has actually promoted innovations and networks in the beneficiary farms. The analysis relies on sample data collected in 2021 in Italy and Poland via interviews of 500 farmers under 40 who had entered the sector both with and without the aid. A probit model estimates whether the beneficiaries have a higher probability to innovate and network. Then, the contribution of the aid to the intensity of the adoption of innovations and networks is estimated via an Average Treatment Effect on the Treated model (ATT). Results suggest that the start-up aid increased the adoption of innovations and networks. The ATT indicates that this positive effect holds even after correcting for self-selection bias. By adopting an original perspective, our analysis suggests that the start-up aid for young farmers goes beyond rejuvenating agriculture by fostering innovation at the farm level and by promoting networking, thus enhancing agricultural change. However, farmer behaviors in the two countries are different, suggesting quite complex patterns for the impact of this measure. [ABSTRACT FROM AUTHOR]

The endurance and vitality of European agriculture are threatened by the aging of farmers, together with the lack of generational change. The small share of young farmers also impacts on the innovative capacity and competitiveness of the sector. The Common Agricultural Policy of the European Union started addressing the issue long ago by providing financial aid to help young farmers to start up. Over time, the aid increased and packages of measures were set to reinforce the aid and to promote investments, innovations, and networks at the farm level. While the literature focuses on analyzing the effectiveness of the start-up aid in fostering new entries, this paper assumes an original perspective as it seeks to assess whether this aid has actually promoted innovations and networks in the beneficiary farms. The analysis relies on sample data collected in 2021 in Italy and Poland via interviews of 500 farmers under 40 who had entered the sector both with and without the aid. A probit model estimates whether the beneficiaries have a higher probability to innovate and network. Then, the contribution of the aid to the intensity of the adoption of innovations and networks is estimated via an Average Treatment Effect on the Treated model (ATT). Results suggest that the start-up aid increased the adoption of innovations and networks. The ATT indicates that this positive effect holds even after correcting for self-selection bias. By adopting an original perspective, our analysis suggests that the start-up aid for young farmers goes beyond rejuvenating agriculture by fostering innovation at the farm level and by promoting networking, thus enhancing agricultural change. However, farmer behaviors in the two countries are different, suggesting quite complex patterns for the impact of this measure.

Hardly any sector has been hit as hard by the COVID-19 pandemic as the air transport industry. As lockdown measures are lifted, a recovery phase begins that will shape the global economic landscape for the years to come. In this context this paper raises the question of whether the pre-existing EU instruments for subsidizing air operations - Start-up aid and the Public Service Obligation - none of which was designed with economic recovery in mind - can be adapted to the new circumstances after the current ad hoc measures under the Temporary Framework have dried up. The hypothesis which is taken as a starting point is that the existing state aid toolbox has built-in deficiencies which are hampering recovery efforts. This paper therefore attempts to determine whether alternatives can be sought within the confines of the EU state aid law, and if so what such alternatives might be. [ABSTRACT FROM AUTHOR]

The purpose of this paper is to analyze the European Commission's approach to state aid to attract foreign direct investment (FDI) in a competition policy framework. The Commission considers variable cost aid ( VCA) to be more distortive than start-up or fixed cost aid ( FCA). This paper addresses that issue and checks whether allowing FCA while banning VCA is an optimal strategy for a supranational Competition Authority maximizing welfare. The model shows that a domestic government maximizing welfare always prefers VCA to FCA if both the incumbent and the entrant are foreign firms and if granting VCA does not cause the incumbent firm to exit the market. The model shows that banning VCA may lead to sub-optimal equilibria where welfare is not maximized. [ABSTRACT FROM AUTHOR]