Which is the Right Dose of EU Cohesion Policy for Economic Growth?

26 Pages Posted: 19 Jan 2009

See all articles by Tobias Hagen

Tobias Hagen

Frankfurt University of Applied Sciences - ReLUT - Research Lab for Urban Transport

Philipp Mohl

ZEW – Leibniz Centre for European Economic Research

Date Written: 2008

Abstract

The current empirical literature on the impact of EU Cohesion Policy on the economic growth rates of the European regions mainly relies on functional form assumptions. However, it is ex ante not clear which functional form is appropriate with regard to the relationship between structural funds payments and regional economic growth. In order to avoid such assumptions, this paper applies the method of generalized propensity score (GPS) to a sample of 122 NUTS-1 and NUTS-2 EU-15 regions for the time period 1995-2005, which leads to the estimation of a dose-response function, as proposed by Hirano and Imbens (2004). Our results indicate that structural funds payments have a positive, but not statistically significant, impact on the regions' average three-year growth rates. This implies that it does not matter which "dose" of structural funds payments a region receives.

Keywords: EU structural funds, economic growth, continuous treatment, dose-response function

JEL Classification: C21, I38, R11

Suggested Citation

Hagen, Tobias and Mohl, Philipp, Which is the Right Dose of EU Cohesion Policy for Economic Growth? (2008). ZEW - Centre for European Economic Research Discussion Paper No. 08-104, Available at SSRN: https://ssrn.com/abstract=1328869 or http://dx.doi.org/10.2139/ssrn.1328869

Tobias Hagen

Frankfurt University of Applied Sciences - ReLUT - Research Lab for Urban Transport

Germany

Philipp Mohl (Contact Author)

ZEW – Leibniz Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1
D-68034 Mannheim, 68034
Germany

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