Regional Growth and Policies in the European Union: Does the Common Agricultural Policy Have a Counter‐Treatment Effect?

Abstract

This article investigates the impact of both the Common Agricultural Policy and structural policies on European regions by estimating a conditional growth convergence model. The Common Agricultural Policy influences the convergence process by affecting regional aggregate productivity, eventually conflicting with the structural policies designed to promote growth in lagging regions. The conditional convergence model is specified in a dynamic panel data form and applied to 206 regions observed from 1989 to 2000. A GMM estimation is applied in order to obtain consistent estimates of both the convergence parameter β and the impact of the conditioning variables, policy measures in particular. Copyright 2007, Oxford University Press.

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

“…Conversely, other research suggests that the CAP does not counteract the impact of the EU Regional Policy (Esposti, 2007) and 1 Mohl and Hagen (2010) reviewed at least 15 other quantitative studies, which with similar approaches to those discussed above, reached altogether conflicting conclusions on the impact of the EU Cohesion Policies.…”

“…The 'spatially targeted' approach of the EU Regional Policy has been successful in supporting regional growth. Conversely, the CAP -notwithstanding the relevance of the financial resources distributed in each region -has not produced any relevant influence on average regional growth (Esposti, 2007). Furthermore, the results for rural development are not more encouraging: even if rural development policies should, in principle, combine an emphasis on rural areas with a bottom-up approach, they seem unable to do better than 'traditional' CAP interventions in terms of territorial cohesion.…”

Does the Decoupling Reform Affect Agricultural Employment in Sweden? Evidence from an Exogenous Change

“…Regarding regional economic performance in general, Esposti () finds no influence of direct payments on growth. He uses regional EU (NUTS 2 level) data for the years 1989–2000 to estimate a conditional growth convergence model, finding that structural fund payments do have a positive impact on growth.…”

In Tandem for Cohesion? Synergies and Conflicts between Regional and Agricultural Policies of the European Union

“…Esposti (2007) with reference to the same time period also underlined how the enormous volume of CAP spending had no positive effect upon regional growth, although not constituting a 'counter-treatment' with respect to regional policies.…”