European Union cohesion project characteristics and regional economic growth

A new approach, which estimates 'unexplained economic growth', provides insights into the types of European Union cohesion projects that produce bette

Publishing date: 04 February 2021
Authors: Zsolt Darvas Jan Mazza Catarina Midões

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This paper is an extended and revised version of an original study titled ‘Effectiveness ofcohesion policy: learning from the project characteristics that produce the best results’, done by the authors (along with Antoine Mathieu Collin) for the European Parliament’s Committee onBudgetary Control (CONT). The opinions expressed in this document are the sole responsibilityof the authors and do not necessarily represent the official position of the European Parliament. The authors thank Kaare Barslev, István Kónya, several colleagues from the European Parliament

and European Commission, and seminar and conference participants at Bruegel, the 2020 European Week of Regions and Cities and the 2020 Conference of the Hungarian Economic Association for comments and suggestions.

Due to problems with existing methodologies that aim to identify the causal impact of European Union cohesion policy on economic growth, we adopted a novel methodology. We first estimated ‘unexplained economic growth’ by controlling for the influence of various region-specific factors, and then analysed its relationship with about two dozen characteristics specific to projects carried out in various regions in the context of EU cohesion policy. We found that the best-performing regions have on average projects with longer durations, more inter-regional focus, lower national co-financing, more national (as opposed to regional and local) management, higher proportions of private or non-profit participants among the beneficiaries (as opposed to public-sector beneficiaries) and higher levels of funding from the Cohesion Fund. No clear patterns emerged concerning the sector of intervention.

Recommended citation

Darvas, Z., J. Mazza and C. Midões (2021) ‘European Union cohesion project characteristics and regional economic growth’, Working Paper 02/2021, Bruegel

About the authors

Zsolt Darvas

Zsolt Darvas is a Senior Fellow at Bruegel and a part-time Senior Research Fellow at the Corvinus University of Budapest. He joined Bruegel in 2008 as a Visiting Fellow, and became a Research Fellow in 2009 and a Senior Fellow in 2013.

From 2005 to 2008, he was the Research Advisor of the Argenta Financial Research Group in Budapest. Before that, he worked at the research unit of the Central Bank of Hungary (1994-2005) where he served as Deputy Head.

Zsolt holds a Ph.D. in Economics from Corvinus University of Budapest where he teaches courses in Econometrics but also at other institutions since 1994. His research interests include macroeconomics, international economics, central banking and time series analysis.
Jan Mazza

Jan, an Italian and Polish citizen, is a research assistant at Bruegel. He holds a Bachelor's degree in Economics and Political Science and a Master's degree in Economics, both from the University of Bologna, and a Master of Science in Economics and Philosophy from the London School of Economics. During his studies, he also spent a semester at the University Paris-2 Panthéon-Assas and one at the Ludwig-Maximilians University of Munich.

Before joining Bruegel he was a trainee at the European Commission (DG Budget) and at the Brussels office of Assonime, the association of Italian joint stock companies.

His research interests include European governance, international economics, monetary and fiscal policy.

Jan is fluent in Italian, English and French and has a good knowledge of Spanish.
Catarina Midões

Catarina Midões works at Bruegel as a Research Analyst, where her research is centred on Better Regulation in EU law-making, Competition Policy and Cohesion Policy. Catarina holds an MSc in Econometrics and Operations Research with a Specialisation in Econometrics from Maastricht University and a BSc in Economics from Nova SBE. Her research work has been focused in inequality, ex-post impact evaluation of public policy and inference techniques.

Before joining Bruegel, Catarina worked as an Economic Analyst at Oxera, where she focused on efficiency benchmarking in the regulated utility markets, using Stochastic Frontier Analysis and Data Envelopment Analysis, and on transport economics, in ex-ante evaluation of transport projects and estimation of public transport demand elasticities.

Catarina also completed an internship in the European Commission’s Joint Research Center, in the Competence Centre on Microeconomic Evaluation, where she focused on implementation of Structural Reforms. Catarina also worked as a Research Assistant in Nova School of Business and Economics, as part of the research centre NOVAFRICA.

She is fluent in Portuguese, English and Spanish and has a working knowledge of Italian.