IDEAS home Printed from https://ideas.repec.org/a/eee/jomega/v101y2021ics0305048319308473.html
   My bibliography  Save this article

Evaluating the efficiency of structural funds: An application in the competitiveness of SMEs across different EU beneficiary regions

Author

Listed:
  • Gouveia, M.C.
  • Henriques, C.O.
  • Costa, P.

Abstract

The funds dedicated to the cohesion policy are aimed at attaining the convergence of wealth levels across the European Union (EU) member states. These constitute the second-highest group of expenditures in the EU budget and thus their evaluation assumes a prominent role. Their assessment can be carried out through different tools and methodologies, all of them with their own merits and flaws. For instance, macroeconomic models allow assessing the potential impact of EU funds on economic growth, but disregard management issues. Other modelling approaches consider direct econometric estimations which might bring biased estimates of the impacts of Structural Funds if some variables are omitted. A different possible tool is Data Envelopment Analysis (DEA), which is a non-parametric method to measure the relative efficiency of Decision-Making Units (DMUs), allowing for the consideration of multiple inputs and outputs in global performance evaluation. In this work we employ the Value-Based DEA approach, which combines DEA with Multiple Criteria Decision Aiding (MCDA) and enables performing a robustness analysis of the results in face of uncertain information, considering the main factors that might influence the efficiency of the implementation of Structural Funds. Specifically, we address the assessment of its application in the competitiveness of small and medium-sized enterprises (SMEs), in different beneficiary regions of the EU. Our analysis helped in the identification of best practices, sources of inefficiency and gaps regarding the benchmark regions/countries, thus leading to shape opportunities for improvement. Overall, we were able to ascertain that national inefficient programmes mainly need to reduce their dependence on EU co-funding to become efficient, whereas almost all inefficient regional programmes need to improve their capacity of execution. Nevertheless, differences were found on the factors that require adjustments when considering regions’ categories.

Suggested Citation

  • Gouveia, M.C. & Henriques, C.O. & Costa, P., 2021. "Evaluating the efficiency of structural funds: An application in the competitiveness of SMEs across different EU beneficiary regions," Omega, Elsevier, vol. 101(C).
    • Handle: RePEc:eee:jomega:v:101:y:2021:i:c:s0305048319308473
    DOI: 10.1016/j.omega.2020.102265
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0305048319308473
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.omega.2020.102265?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Per Andersen & Niels Christian Petersen, 1993. "A Procedure for Ranking Efficient Units in Data Envelopment Analysis," Management Science, INFORMS, vol. 39(10), pages 1261-1264, October.
    2. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    3. Becker, Sascha O. & Egger, Peter H. & von Ehrlich, Maximilian, 2010. "Going NUTS: The effect of EU Structural Funds on regional performance," Journal of Public Economics, Elsevier, vol. 94(9-10), pages 578-590, October.
    4. Jan Fagerberg & Bart Verspagen, 1996. "Heading for Divergence? Regional Growth in Europe Reconsidered," Journal of Common Market Studies, Wiley Blackwell, vol. 34(3), pages 431-448, September.
    5. Julie Le Gallo & Sandy Dall'Erba & Rachel Guillain, 2011. "The Local versus Global Dilemma of the Effects of Structural Funds," Growth and Change, Wiley Blackwell, vol. 42(4), pages 466-490, December.
    6. Aadne Cappelen & Fulvio Castellacci & Jan Fagerberg & Bart Verspagen, 2003. "The Impact of EU Regional Support on Growth and Convergence in the European Union," Journal of Common Market Studies, Wiley Blackwell, vol. 41(4), pages 621-644, September.
    7. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
    8. Sandy Dall'erba & Julie Le Gallo, 2008. "Regional convergence and the impact of European structural funds over 1989–1999: A spatial econometric analysis," Papers in Regional Science, Wiley Blackwell, vol. 87(2), pages 219-244, June.
    9. M C Gouveia & L C Dias & C H Antunes, 2008. "Additive DEA based on MCDA with imprecise information," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 59(1), pages 54-63, January.
    10. López-Rodríguez, Jesús & Faíña, Andrés, 2014. "Rhomolo and other methodologies to assess The European Cohesion Policy," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, issue 29, pages 5-13.
    11. Sandy Dall’erba, 2005. "Distribution of regional income and regional funds in Europe 1989–1999: An exploratory spatial data analysis," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 39(1), pages 121-148, March.
    12. Joe Zhu, 2014. "Data Envelopment Analysis," International Series in Operations Research & Management Science, in: Quantitative Models for Performance Evaluation and Benchmarking, edition 3, chapter 1, pages 1-9, Springer.
    13. Zhu, Joe, 2003. "Imprecise data envelopment analysis (IDEA): A review and improvement with an application," European Journal of Operational Research, Elsevier, vol. 144(3), pages 513-529, February.
    14. Mohl, P. & Hagen, T., 2010. "Do EU structural funds promote regional growth? New evidence from various panel data approaches," Regional Science and Urban Economics, Elsevier, vol. 40(5), pages 353-365, September.
    15. Zhu, Joe, 1996. "Robustness of the efficient DMUs in data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 90(3), pages 451-460, May.
    16. Steven N. Durlauf, 2009. "The Rise and Fall of Cross-Country Growth Regressions," History of Political Economy, Duke University Press, vol. 41(5), pages 315-333, Supplemen.
    17. Cook, Wade D. & Tone, Kaoru & Zhu, Joe, 2014. "Data envelopment analysis: Prior to choosing a model," Omega, Elsevier, vol. 44(C), pages 1-4.
    18. Andries Brandsma & d'Artis Kancs & Philippe Monfort & Alexandra Rillaers, 2015. "RHOMOLO: A dynamic spatial general equilibrium model for assessing the impact of cohesion policy," Papers in Regional Science, Wiley Blackwell, vol. 94, pages 197-221, November.
    19. Charnes, A. & Cooper, W. W. & Golany, B. & Seiford, L. & Stutz, J., 1985. "Foundations of data envelopment analysis for Pareto-Koopmans efficient empirical production functions," Journal of Econometrics, Elsevier, vol. 30(1-2), pages 91-107.
    20. Maaike Beugelsdijk & Sylvester C.W. Eijffinger, 2005. "The Effectiveness of Structural Policy in the European Union: An Empirical Analysis for the EU‐15 in 1995–2001," Journal of Common Market Studies, Wiley Blackwell, vol. 43(1), pages 37-51, March.
    21. Dyson, R. G. & Allen, R. & Camanho, A. S. & Podinovski, V. V. & Sarrico, C. S. & Shale, E. A., 2001. "Pitfalls and protocols in DEA," European Journal of Operational Research, Elsevier, vol. 132(2), pages 245-259, July.
    22. M C Gouveia & L C Dias & C H Antunes, 2013. "Super-efficiency and stability intervals in additive DEA," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 64(1), pages 86-96, January.
    23. Kutan, Ali M. & Yigit, Taner M., 2007. "European integration, productivity growth and real convergence," European Economic Review, Elsevier, vol. 51(6), pages 1370-1395, August.
    24. P N de Almeida & L C Dias, 2012. "Value-based DEA models: application-driven developments," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 63(1), pages 16-27, January.
    25. Ali, Agha Iqbal & Lerme, Catherine S. & Seiford, Lawrence M., 1995. "Components of efficiency evaluation in data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 80(3), pages 462-473, February.
    26. Golany, B & Roll, Y, 1989. "An application procedure for DEA," Omega, Elsevier, vol. 17(3), pages 237-250.
    27. Carlos Pinho & Celeste Varum & Micaela Antunes, 2013. "Structural funds and regional growth: conditions for improving efficiency," Economics and Business Letters, Oviedo University Press, vol. 2(4), pages 143-149.
    28. Athanassopoulos, Antreas D., 1996. "Assessing the comparative spatial disadvantage (CSD) of regions in the European Union using non-radial data envelopment analysis methods," European Journal of Operational Research, Elsevier, vol. 94(3), pages 439-452, November.
    29. Benedicta Marzinotto, 2012. "The growth effects of EU cohesion policy- a meta-analysis," Working Papers 754, Bruegel.
    30. Andres RodrIguez-Pose & Ugo Fratesi†, 2004. "Between Development and Social Policies: The Impact of European Structural Funds in Objective 1 Regions," Regional Studies, Taylor & Francis Journals, vol. 38(1), pages 97-113.
    31. Gouveia, M.C. & Dias, L.C. & Antunes, C.H. & Boucinha, J. & Inácio, C.F., 2015. "Benchmarking of maintenance and outage repair in an electricity distribution company using the value-based DEA method," Omega, Elsevier, vol. 53(C), pages 104-114.
    32. Aadne Cappelen & Fulvio Castellacci & Jan Fagerberg & Bart Verspagen, 2003. "The Impact of EU Regional Support on Growth and Convergence in the European Union," Journal of Common Market Studies, Wiley Blackwell, vol. 41(4), pages 621-644, September.
    33. R. D. Banker & A. Charnes & W. W. Cooper, 1984. "Some Models for Estimating Technical and Scale Inefficiencies in Data Envelopment Analysis," Management Science, INFORMS, vol. 30(9), pages 1078-1092, September.
    34. Zhu, Joe, 2001. "Super-efficiency and DEA sensitivity analysis," European Journal of Operational Research, Elsevier, vol. 129(2), pages 443-455, March.
    35. M. C. Gouveia & L. C. Dias & C. H. Antunes & M. A. Mota & E. M. Duarte & E. M. Tenreiro, 2016. "An application of value-based DEA to identify the best practices in primary health care," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 38(3), pages 743-767, July.
    36. Riccardo Crescenzi & Mara Giua, 2014. "The EU Cohesion policy in context: regional growth and the influence of agricultural and rural development policies," LEQS – LSE 'Europe in Question' Discussion Paper Series 85, European Institute, LSE.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Henriques, C.O. & Gouveia, C.M. & Tenente, M. & da Silva, P.P., 2022. "Employing Value-Based DEA in the eco-efficiency assessment of the electricity sector," Economic Analysis and Policy, Elsevier, vol. 73(C), pages 826-844.
    2. Henriques, C.O. & Gouveia, M.C., 2022. "Assessing the impact of COVID-19 on the efficiency of Portuguese state-owned enterprise hospitals," Socio-Economic Planning Sciences, Elsevier, vol. 84(C).
    3. Henriques, C.O. & Chavez, J.M. & Gouveia, M.C. & Marcenaro-Gutierrez, O.D., 2022. "Efficiency of secondary schools in Ecuador: A value based DEA approach," Socio-Economic Planning Sciences, Elsevier, vol. 82(PA).
    4. Gouveia, M.C. & Henriques, C.O. & Dias, L.C., 2023. "Eco-efficiency changes of the electricity and gas sectors across 28 European countries: A value-based data envelopment analysis productivity approach," Socio-Economic Planning Sciences, Elsevier, vol. 87(PB).
    5. Maria Gouveia & Carla Henriques & Ana Amaro, 2022. "Is the Cohesion Policy Efficient in Supporting the Transition to a Low-Carbon Economy? Some Insights with Value-Based Data Envelopment Analysis," Sustainability, MDPI, vol. 14(18), pages 1-24, September.
    6. D’Amico, Gaspare & Arbolino, Roberta & Shi, Lei & Yigitcanlar, Tan & Ioppolo, Giuseppe, 2022. "Digitalisation driven urban metabolism circularity: A review and analysis of circular city initiatives," Land Use Policy, Elsevier, vol. 112(C).
    7. Salvatore Ammirato & Gerarda Fattoruso & Antonio Violi, 2022. "Parsimonious AHP-DEA Integrated Approach for Efficiency Evaluation of Production Processes," JRFM, MDPI, vol. 15(7), pages 1-15, June.
    8. Monge, Juan F. & Ruiz, José L., 2023. "Setting closer targets based on non-dominated convex combinations of Pareto-efficient units: A bi-level linear programming approach in Data Envelopment Analysis," European Journal of Operational Research, Elsevier, vol. 311(3), pages 1084-1096.
    9. Carla Zarbà & Salvatore Bracco & Biagio Pecorino & Gioacchino Pappalardo & Gaetano Chinnici & Mario D’Amico, 2022. "Supporting Agri-Food SMEs in Italy in the Post-COVID-19 Context: From Horizon 2020 to Horizon Europe," Sustainability, MDPI, vol. 14(13), pages 1-18, June.
    10. Carla Henriques & Clara Viseu & António Trigo & Maria Gouveia & Ana Amaro, 2022. "How Efficient Is the Cohesion Policy in Supporting Small and Mid-Sized Enterprises in the Transition to a Low-Carbon Economy?," Sustainability, MDPI, vol. 14(9), pages 1-55, April.
    11. Sonja Đuričin & Isidora Beraha & Olivera Jovanović & Marija Mosurović Ružičić & Marija Lazarević-Moravčević & Mihailo Paunović, 2022. "The Efficiency of National Innovation Policy Programs: The Case of Serbia," Sustainability, MDPI, vol. 14(14), pages 1-14, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jan Fidrmuc & Martin Hulényi & Olga Zajkowska, 2019. "The Elusive Quest for the Holy Grail of an Impact of EU Funds on Regional Growth," CESifo Working Paper Series 7989, CESifo.
    2. Henriques, C.O. & Chavez, J.M. & Gouveia, M.C. & Marcenaro-Gutierrez, O.D., 2022. "Efficiency of secondary schools in Ecuador: A value based DEA approach," Socio-Economic Planning Sciences, Elsevier, vol. 82(PA).
    3. Sandy Dall'Erba & Fang Fang, 2017. "Meta-analysis of the impact of European Union Structural Funds on regional growth," Regional Studies, Taylor & Francis Journals, vol. 51(6), pages 822-832, June.
    4. Catarina Alexandra Neves Proença & Maria Elisabete Duarte Neves & Maria Castelo Baptista Gouveia & Mara Teresa Silva Madaleno, 2023. "Technological, healthcare and consumer funds efficiency: influence of COVID-19," Operational Research, Springer, vol. 23(2), pages 1-42, June.
    5. Gouveia, M.C. & Dias, L.C. & Antunes, C.H. & Boucinha, J. & Inácio, C.F., 2015. "Benchmarking of maintenance and outage repair in an electricity distribution company using the value-based DEA method," Omega, Elsevier, vol. 53(C), pages 104-114.
    6. Davide Fiaschi & Andrea Mario Lavezzi & Angela Parenti, 2018. "Does EU cohesion policy work? Theory and evidence," Journal of Regional Science, Wiley Blackwell, vol. 58(2), pages 386-423, March.
    7. Mindaugas Butkus & Alma Maciulyte-Sniukiene & Kristina Matuzeviciute, 2020. "Heterogeneous growth outcomes of the EU’s regional financial support mediated by institutions with some empirical evidences at NUTS 3 level," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 40(1), pages 33-66, April.
    8. Carla Henriques & Clara Viseu & António Trigo & Maria Gouveia & Ana Amaro, 2022. "How Efficient Is the Cohesion Policy in Supporting Small and Mid-Sized Enterprises in the Transition to a Low-Carbon Economy?," Sustainability, MDPI, vol. 14(9), pages 1-55, April.
    9. Carlos Pinho & Celeste Varum & Micaela Antunes, 2013. "Structural funds and regional growth: conditions for improving efficiency," Economics and Business Letters, Oviedo University Press, vol. 2(4), pages 143-149.
    10. Enrico Fabrizi & Gianni Guastella & Stefano Marta & Francesco Timpano, 2016. "Determinants of Intra-Distribution Dynamics in European Regions: An Empirical Assessment of the Role of Structural Intervention," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 107(5), pages 522-539, December.
    11. Henriques, C.O. & Gouveia, M.C., 2022. "Assessing the impact of COVID-19 on the efficiency of Portuguese state-owned enterprise hospitals," Socio-Economic Planning Sciences, Elsevier, vol. 84(C).
    12. M. C. Gouveia & L. C. Dias & C. H. Antunes & M. A. Mota & E. M. Duarte & E. M. Tenreiro, 2016. "An application of value-based DEA to identify the best practices in primary health care," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 38(3), pages 743-767, July.
    13. Paolo Di Caro & Ugo Fratesi, 2022. "One policy, different effects: Estimating the region‐specific impacts of EU cohesion policy," Journal of Regional Science, Wiley Blackwell, vol. 62(1), pages 307-330, January.
    14. Kadziński, Miłosz & Labijak, Anna & Napieraj, Małgorzata, 2017. "Integrated framework for robustness analysis using ratio-based efficiency model with application to evaluation of Polish airports," Omega, Elsevier, vol. 67(C), pages 1-18.
    15. Maria Elisabete Duarte Neves & Maria Do Castelo Gouveia & Catarina Alexandra Neves Proença, 2020. "European Bank’s Performance and Efficiency," JRFM, MDPI, vol. 13(4), pages 1-17, April.
    16. Sergio Destefanis & Valter Di Giacinto, 2023. "EU structural funds and GDP per capita: spatial VAR evidence for the European regions," Temi di discussione (Economic working papers) 1409, Bank of Italy, Economic Research and International Relations Area.
    17. Ramanathan, Ramakrishnan & Ramanathan, Usha & Bentley, Yongmei, 2018. "The debate on flexibility of environmental regulations, innovation capabilities and financial performance – A novel use of DEA," Omega, Elsevier, vol. 75(C), pages 131-138.
    18. Lionel Vedrine & Julie Le Gallo, 2021. "Does EU Cohesion Policy affect territorial inequalities and regional development?," Post-Print hal-03327693, HAL.
    19. Victoria Wojcik & Harald Dyckhoff & Marcel Clermont, 2019. "Is data envelopment analysis a suitable tool for performance measurement and benchmarking in non-production contexts?," Business Research, Springer;German Academic Association for Business Research, vol. 12(2), pages 559-595, December.
    20. Hisham Alidrisi & Mehmet Emin Aydin & Abdullah Omer Bafail & Reda Abdulal & Shoukath Ali Karuvatt, 2019. "Monitoring the Performance of Petrochemical Organizations in Saudi Arabia Using Data Envelopment Analysis," Mathematics, MDPI, vol. 7(6), pages 1-16, June.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jomega:v:101:y:2021:i:c:s0305048319308473. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/375/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.