and capital with about two thirds being interested in accessing a loan but only 15% of PSG recipients an 10% of non-recipients being able to access a much diminished amount of credit (from almost $ 40,000 to slightly above 20,000 per loan) at an interest rate that was almost double what had been charged in 2022.

In 2023, respondents were also asked about their interest in loans for working capital or investment at the prevailing interest rate (of 5%). About 40% of PSG recipients and non-recipients are interested in a loan with a desired mean loan size of about $ 33,600 (with a median of $ 16,400) for working capital loans and $ 84,800 (with a median of $ 54,700) for investment loans which translates into about $ 510/ha for working capital and $ 1700/ha for investment loans for all but the smallest farm size group. The $ 89 received on average via the PSG amounts to less than 20% or 10% of expressed demand for working or investment credit, respectively. Demand for grants with a 25% matching component is, with 63%, significantly higher, especially in the 20-120 ha group, implying that a matching component could possibly serve as a useful tool to separate between loan demand for consumption smoothing and for investment. For PSG recipients, table 3 panel B suggests more than 98% of resources received was reported to have been used as working capital for crop or livestock production (88% and 11%, respectively) and only 1% reporting to have used the resources for investment.

If access to PSG (and survey response) were random, the double difference _ΔPSG_ - _ΔNon-PSG_ between values in 2023 and 2022 for PSG participants and non-participants, would provide an estimate of the program effect. Results of a t-test for _ΔPSG_ - _ΔNon-PSG_ = 0 reported in column 8 suggest that none of the other variables show a significant difference. To avoid potential bias from selective responses to the survey, we use cadastral data for the universe that is available for the universe of eligible SAR registrants to check if receipt of a PSG grant affects this variable.

# **4. Assessing PSG impacts on area cultivated and targeting**

Cadastral parcel data, together with satellite-based crop maps, suggest that, despite incentives to overstate cultivated area, targeting rules were largely adhered to. A difference in differences design that leverages the timing of program implementation using 5 years of panel data on area cultivated with agricultural crops by the universe of PSG-eligible SAR registrants suggest the program had significant, albeit modest benefits the incidence of which was concentrated among small producers near the frontline.

# **4.1 Data and evidence on targeting**

Overlaying cadastral data for all parcels to which a farm has registered rights with public crop maps (available at <u>https://ukraine-cropmaps.com/) for winter and summer seasons separately,</u><sup>22</sup> allows us to

> 22 Crop maps had been produced under the EU/WB program to ‘Improving Transparency of Land Governance in Ukraine’. Refer to (Kussul _et al._ 2022) for the methodology and recent applications. Land registered in the name of the owner but rented out informally could, in principle, have been falsely reported as self-cultivated and counted towards the owners’ eligibility but was considered not to be significant enough to matter.

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