Does EU cohesion policy work? Theory and evidence
Davide Fiaschi (),
Andrea Mario Lavezzi and
Angela Parenti ()
Journal of Regional Science, 2018, vol. 58, issue 2, 386-423
This paper evaluates the effectiveness of European Cohesion Policy in the regions of 12 EU countries in the period 1991â€“2008, on the basis of a spatial growth model, which allows for the identification of both direct and indirect effects of EU funds on GDP per worker growth. We find that â€œObjective 1â€ funds are characterized by strong spatial externalities and a positive and concave effect on the growth of GDP per worker, which reaches a peak at the ratio funds/GDP of approximately 3 percent and becomes nonâ€ significant after 4 percent. â€œObjective 2â€ and â€œCohesionâ€ funds have nonsignificant effects, while all the other funds exert a positive and significant effect, but their size is very limited. EU Cohesion Policy, moreover, appears to have increased its effectiveness over time. In the period 2000â€“2006 Objective 1 funds are estimated to have a median multiplier equal to 1.52, and to have added 0.37 percent to the GDP per worker growth. Overall, in the period 1991â€“2008, funds are estimated to have added 1.4 percent to the median annual growth, and to have reduced regional disparities of 8 basis points in terms of the Gini index.
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Working Paper: Does EU Cohesion Policy Work? Theory and Evidence (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:bla:jregsc:v:58:y:2018:i:2:p:386-423
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