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How does EU cohesion policy work? Evaluating its effects on fiscal outcome variables

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Author Info
Hagen, Tobias
Mohl, Philipp

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Abstract

The impact of EU Cohesion Policy has mainly been evaluated with regard to its growth effects. We extend the perspective by investigating the impact of EU Cohesion Policy on public investments and budget deficits in order to learn more about the channels through which this policy field works. Using a dataset of 27 EU countries for the time period 1982-2006, we find that EU Cohesion Policy payments do not cause public investments to increase significantly, which points to a crowding out of national investment. Moreover, the hypothesis that EU Cohesion Policy is used for the consolidation of public budgets cannot be completely rejected. --

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Publisher Info
Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 09-051.

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Date of creation: 2009
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Handle: RePEc:zbw:zewdip:09051

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Related research
Keywords: EU Cohesion Policy; public investment; public deficits; panel data;

Find related papers by JEL classification:
C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data
H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus

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This page was last updated on 2009-11-27.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.