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Tatiane Iélia Da Silva and Wellington Ribeiro Justo |
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''The economic impact of subsidized credit on regional development: Evidence from Brazil's Northeast Constitutional Financing Fund (FNE), 2010–2022'' |
( 2025, Vol. 45 No.3 ) |
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This study evaluates the economic effects of Brazil's Northeast Constitutional Financing Fund (FNE) on growth and employment in the SUDENE region from 2010 to 2022. Using a generalized propensity score (GPS) dose-response model, we find that FNE credit significantly increases GDP, GDP per capita and employment, with larger effects in less developed states. The analysis reveals non-linear impacts, with diminishing marginal returns at higher credit levels, highlighting the role of the FNE in mitigating regional disparities. These findings provide actionable insights for policymakers in credit-constrained regions. |
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Keywords: Subsidized Credit, Regional Development, FNE, Dose-Response Model, Brazil |
JEL: O1 - Economic Development: General R1 - General Regional Economics (includes Regional Data) |
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Manuscript Received : Mar 28 2025 | | Manuscript Accepted : Sep 30 2025 |
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