Spatial Discontinuity for the Impact Assessment of the Eu Regional Policy: The Case of Italian Objective 1 Regions*

Abstract

The economic impact of the Regional Policy of the European Union is still controversial. This paper exploits administrative boundaries as spatial discontinuity to estimate the causal effect of this policy on the Italian Objective 1 regions’ employment. The analysis, developed both in a border strategy framework (municipalities contiguous to the policy‐change boundary) and with more traditional RDD models balanced by spatial forcing variables (centroids’ distance and coordinates), shows that the EU Regional Policy produced a positive impact on employment levels, without any displacement of economic activities away from nontreated regions and a concentration of the impact in key economic sectors.

Boulevard of broken dreams. The end of EU funding (1997: Abruzzi, Italy)

“…Giua (2014) confirms this positive result for the Italian case (that we study in this paper) with respect to employment growth. While these findings are very relevant and not obvious on an a priori ground, one can argue that it is not sufficient for supporting EU Cohesion policy: EU transfers may have positive short-run effects on regional economies, without triggering a self-sustaining faster growing path.…”

The EU Cohesion Policy in context: Does a bottom-up approach work in all regions?

“…Institutional (Bahr, 2008;Cappelen et al, 2003;Ederveen et al, 2002 and and structural (Bouayad-agha, Turpin and Védrine, 2010;de Freitas, Pereira and Torres, 2003;Eggert et al, 2008;Giua, 2016;Martin and Tyler, 2006;Mohl and Hagen, 2008;Ramajo et al, 2008;Soukiazis and Antunes, 2006) elements have received a special attention in this stream of research. Other contributions have also looked into the nature and composition of the various policy measures promoted and funded by the EU Cohesion policy, highlighting a strong heterogeneity in the returns to different areas of expenditure and the limited impact of unbalanced strategies narrowly focused on infrastructure (Dall'erba, Guillain and Le Gallo, 2007;Rodríguez-Pose and Fratesi, 2004).…”

European Structural Funds During the Crisis: Evidence from Southern Italy

“…Andini and de Blasio (2014) argue that "Contratti di Programma," an intervention by means of which the Government approves and finances industrial projects proposed by private firms, had limited effects on local growth (and mostly at the expenses of the surrounding territories). Finally, the only paper that deals with overall EU funding effectiveness in Italy, irrespective of the specific program through which the money is channeled into the economy, is Giua (2014). She considers in a RDD set-up the differences in employment growth across municipalities on the two sides of the Objective 1 border and finds a positive impact on employment.…”