Evaluating the effectiveness of Axis-3 LEADER Grants on Job Creation

This study investigates the relationship between the number of jobs created and funding granted as part of the Community Led Local Development element within the Northern Ireland Rural Development Programme. Analysis is carried out using ex-post application level data associated with Axis 3-LEADER during the 2007-2013 period. A two-step procedure is used to estimate a negative binomial model and correct for sample selection. Results indicate that there is a positive and statistically significant relationship between the number of created jobs and the amount of awarded grant and that this relationship depends on the categories, or Measures, within Axis 3. The more economic focused Measures such as Farm Diversification, Business Development, and Tourism showed a statistically significant link between the amount of public funds and job creation. No such relationship was found for the other Measures. However, we found a substantial mismatching between the selection process to fund applications and the job creation process leading to policy recommendations.