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Regional Convergence And The Impact Of European Structural Funds Over 1989-1999: A Spatial Econometric Analysis

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  • Sandy Dall'erba

    (REAL)

  • Julie Le Gallo

    (IERSO)

Abstract

This paper estimates the impact of structural funds on the convergence process between 145 European regions over 1989-1999. Since the majority of these funds finance transportation infrastructures, they induce spillover effects, industry relocation and do not necessarily succeed in reducing regional inequalities. To estimate their impact, including spillover effects, we first apply spatial econometrics on a conditional beta-convergence model; second, we simulate their impact on the targeted region and then on all the other regions. The results show that structural funds have positively benefited to the targeted regions’ growth, but that spillover effects are very small in peripheral regions.

Suggested Citation

  • Sandy Dall'erba & Julie Le Gallo, 2003. "Regional Convergence And The Impact Of European Structural Funds Over 1989-1999: A Spatial Econometric Analysis," Urban/Regional 0310005, EconWPA, revised 12 Feb 2004.
  • Handle: RePEc:wpa:wuwpur:0310005
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    Keywords

    European structural funds; beta-convergence; spatial econometrics; geographic spillovers;

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods

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