The growth effects of EU cohesion policy: a meta-analysis. Bruegel Working Paper 2012/14, October 2012

We run a standard income convergence analysis for the last decade and confirm an already established finding in the growth economics literature. EU countries are converging. Regions in Europe are also converging. But, within countries, regional disparities are on the rise. At the same time, there is probably no reason for EU Cohesion Policy to be concerned with what happens inside countries. Ultimately, our data shows that national governments redistribute well across regions, whether they are fiscally centralised or decentralised. It is difficult to establish if Structural and Cohesion Funds play any role in recent growth convergence patterns in Europe. Generally, macroeconomic simulations produce better results than empirical tests. It is thus possible that Structural Funds do not fully realise their potential either because they are not efficiently allocated or are badly managed or are used for the wrong investments, or a combination of all three. The approach to assess the effectiveness of EU funds should be consistent with the rationale behind the post-1988 EU Cohesion Policy. Standard income convergence analysis is certainly not sufficient and should be accompanied by an assessment of the changes in the efficiency of the capital stock in the recipient countries or regions as well as by a more qualitative assessment. EU funds for competitiveness and employment should be allocated by looking at each region’s capital efficiency to maximise growth generating effects or on a pure competitive.

Location choices of multinational firms in Europe: the role of EU cohesion policy

Using data on 5509 foreign subsidiaries established in 50 regions of 8 EU countries over the period 1991–1999, we estimate a mixed logit model of the location choice of multinational firms in Europe. In particular, we focus on the role of EU Cohesion Policy in attracting foreign investors from both within and outside Europe. We find that, after controlling for the role of agglomeration economies as well as a number of other regional and country characteristics and allowing for a very flexible correlation pattern among choices, Structural and Cohesion funds allocated by the EU to laggard regions have indeed contributed to attracting multinationals. These policies as well as other determinants play a different role in the case of European investors as opposed to non-European ones.

Microcredit and EU Cohesion Policy

After nearly four years of the most serious financial and economic crisis Europe has seen in 80 years, most EU Member States are facing high budget deficits, growing public debts, while most entrepreneurs are facing difficulties in accessing finance due to the credit crunch. Meanwhile there are more than 23 million unemployed in the EU and unemployment rates have reached an average of 10% and more than 20% in Greece and Spain1. Microcredit can provide an answer to the employment challenges caused by the current economic crisis and to reach the 75% employment target rate set in the Europe 2020 strategy.

Linking Cohesion Policy to European Economic Governance: an Idea Up for Improvement. European Policy Brief No. 3, September 2011

The idea of linking cohesion policy to EU economic governance has received the support of several EU institutions. The nature of such link is still to be agreed upon and is likely to lead to intense discussions. This Policy Brief argues that while the Commission’s envisaged proposal has its merits, it would nevertheless result in a partial and inconsistent link between the cohesion policy and EU economic governance. A more flexible and coherent approach is proposed.

Macroeconomic Conditionality in Cohesion Policy: Added Value or Unnecessary Burden? European Policy Brief No. 13, November 2012

Macroeconomic conditionality has become one of the major elements in discussions on the future of EU cohesion policy. Such conditional-ity would make the cohesion budget dependent on EU economic governance rules. This would have advantages for economic governance and, to a lesser extent, the efficiency of cohesion policy and the EU’s Multiannual Financial Framework negotiations. Yet, conditionality also risks entailing serious disadvantages for the end beneficiaries and cohesion policy itself. If the EU decides to put macroeconomic conditionality in place, it needs to reconsider the design and agree on an ample cohesion budget.

A kohéziós politika hatékonysága (The efficiency of cohesion policy)

A kohéziós politika hatékonyságát, eredményességét és szabályszerűségét a nemzetállami szint mellett közösségi szinten is értelmezhetjük. Azonban a közösségi szint nem a tagállami részek összege, hanem annál sokkal jelentősebb. Ha a közösségi szinten nem támasztható alá a kohéziós politika szükségszerűsége, akkor annak költségvetése és ezáltal jelentősége az EU következő pénzügyi perspektívájában csökkenhet, amelynek súlyos kihatásai lennének a tagállamok és régióik közötti kohéziós folyamatokra. Éppen ezért fontos a kohéziós politika objektív és részletes elemzése tagállami szinten, valamint a közösségi szintű kohéziós politika kritikáinak és a különböző reformelképzeléseknek vizsgálata. / === / The efficiency, effectiveness and regularity of cohesion policy can be defined both on the community level and on the national level. But the community level more than the sum of the member states. If the necessity of the cohesion policy cannot be backed sufficiently, then its budget of the policy can be decreased in the next financial framework of the EU. This could deeply undermine the process of convergence of the less developed regions of the member states. This is why the objective and detailed analysis of the cohesion policy is important, together with knowing the criticisms and reform proposals of the community level cohesion policy.

The Future of EU Cohesion Policy. Endogenous Development – Added Value of Intervention – Regulatory Frameworks

The successful operation of the regional development – or cohesion – policy of the European Union has a strategic importance from the point of view of the whole integration process. Strengthening economic, social and territorial cohesion and decreasing disparities between member states and regions are not only one of the main priorities of the integration, but at the same time these are justified expectations of the people living in the member states of the union. The cohesion transfers should be spent on those factors which have the biggest contribution to the improvement of development prospects and competitiveness in the given regions. Theories on regional development have controversial conclusions about the long-term formation of development disparities. However, it has become evident that successful development policies are based on endogenous factors, innovation and well-functioning institutions. After examining theoretical considerations and regional disparities the study analyses the impacts of EU regional policy and evaluates the main elements of the proposed regulatory frameworks for the period 2014-2020.