## Targeting State Aid: Firm-level Evidence from France

_IMF Working Papers, June 12, 2026_

## Source details

**Canonical URL:** [Targeting State Aid: Firm-level Evidence from France](https://www.imf.org/en/publications/wp/issues/2026/06/12/targeting-state-aid-firm-level-evidence-from-france-576867)

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## Bibliographic details
- Authors: Xun Li, Maryam Vaziri
- Published: June 12, 2026
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9798229049764.001

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### Research design and data
- Study period: 2016–23.
- Methodology: firm-level data and a difference-in-differences approach.
- Scope: analysis of state aid targeting and its effects on firm-level economic outcomes in France.

### Key empirical findings
- Aid is most effective for young firms, improving real outcomes.
- Aid crowds in private debt financing for recipient firms.
- Size-based targeting has limited impact.
- R&D support is particularly effective for young firms in high-tech sectors.
- Energy aid has the strongest effects in manufacturing, indicating potential to help firms reduce emissions and facilitate the green transition.

### Sectoral and thematic insights
- High-tech sectors: R&D support yields pronounced benefits for young firms.
- Manufacturing: energy aid produces the strongest effects, with implications for emission reductions and the green transition.
- Energy sector and environmental outcomes: evidence suggests state aid can play a role in supporting decarbonization through targeted energy assistance.

### Policy implications and recommendations
- Prioritize targeting state aid to young firms to maximize improvements in real outcomes.
- Consider prioritizing R&D support for young firms in high-tech sectors to enhance innovation-driven growth.
- Deploy energy aid strategically in manufacturing to support emission reductions and facilitate the green transition.
- Reassess size-based targeting approaches given their limited observed impact.

### Publication and identification
- Authors: Xun Li, Maryam Vaziri
- Date: June 12, 2026
- Pages: 31
- Volume: 2026
- Issue: 122
- Series: Working Paper No. 2026/122
- DOI: https://doi.org/10.5089/9798229049764.001
- Stock No: WPIEA2026122
- ISBN: 9798229049764
- ISSN: 1018-5941

*Source: Targeting State Aid: Firm-level Evidence from France, IMF Working Papers (June 12, 2026) by Xun Li and Maryam Vaziri.*

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_Source: https://www.imf.org/en/publications/wp/issues/2026/06/12/targeting-state-aid-firm-level-evidence-from-france-576867_