SELECTED SOCIOECONOMIC IMPACTS OF PUBLIC SUPPORT FOR AGRICULTURAL BIOGAS PLANTS: THE CASE OF THE CZECH REPUBLIC

J. Spicka, J. Krause

Abstract: The main goal of the article is to assess selected socioeconomic impacts of public support for investments and effects of investments in biogas plants in the CR . The need for this analysis arises from requirements for impact evaluation of public subsidies from the Rural Development Programme. The quantification of economic effects of investment support of biogas plants is based on counterfactual analysis. Propensity score matching (PSM) with Mahalanobis distance was used to create treatment-control matches based on propensity scores and/or observed covariate variables. Mann-Whitney U test was used to compare selected indicators between supported and not supported agricultural enterprises. Regarding economic performance of agricultural enterprises, analysis revealed that investments and investment subsidies targeted at biogas plants have positive effect on EBIT, cash flow and value added per hectare of agricultural enterprises. On the other side, there is no significant impact on ROA, ROE and ROCE even if these indicators have been considered as key indicators of companies’ economic performance. Setting up biogas plants does not create any new working positions in most cases, so supported enterprises with biogas plant in operation significantly increased labour productivity compared to companies without biogas plant.

Keywords: agricultural biogas plants; counterfactual analysis; impact evaluation; investment subsidy; propensity score matching; Rural Development Programme

Date published: 2019-01-28