In this paper we aim to explore the conditioning effect of structural funds (SF) on regional growth in Greece for the period 1994–2006 by detecting if the ability of regions to convert any financial aid into welfare gains is related to certain region-specific characteristics. The analysis shows that, albeit that important financial aid has been channelled to the less-developed regions, the most advanced regions seem to have benefited more from it. Furthermore, we divide the SF into expenditure categories and conclude that the SF have a positive impact on growth only for those regions in which the regions’ endowments are related to the expenditure received. This interaction of the expenditure categories with the characteristics of the recipient region accentuates the role of the ‘identity’ of each region to the impact of SF on regional growth, thereby signifying valuable policy implications.
AikenSWestG (1991) Multiple Regression: Testing and Interpreting Interactions, Newbury Park, CA: Sage
2.
AlexiadisSTomkinsJ (2004) “Convergence clubs in the regions of Greece”. Applied Economics Letters11: 387–391
3.
AnselinLBeraA (1998) “Spatial dependence in linear regression models with an introduction to spatial econometrics”. In: UllahAGilesD E (eds) Handbook of Applied Economic Statistics, New York: Marcel Dekker, pp. 237–289
4.
AntunesMSoukiazisE (2009) “Two speed regional convergence in Portugal and the importance of structural funds on growth”. Ekonomia9: 222–241
5.
ArbiaGBasileRMantuanoM (2003) “Does spatial concentration foster economic growth? Empirical evidence on EU regions”. In: TrivezF JMurJAnguloAKaabiaM BCatalanB (eds) Contributions in Spatial Econometrics, Faculdad de Ciencias: Universidad de Zaragoza, pp. 301–326
6.
ArvanitidisPPetrakosGPavleasS (2010) “On the dynamics of growth performance: an expert survey”. Contributions to Political Economy29: 59–86
7.
AschauerD (1989) “Is public expenditure productive?”. Journal of Monetary Economics23: 177–200
8.
BachtlerJGorzelakG (2007) “Reforming EU cohesion policy: a reappraisal of the performance of the Structural Funds”. Policy Studies28: 309–326
9.
BährC (2008) “How does sub-national autonomy affect the effectiveness of structural funds?”. Kyklos61: 3–18
10.
BaldwinRWylposzC (2006) The Economics of European Integration, Maidenhead, Berks: McGraw-Hill
11.
BarroJSala-i-MartinX (1992) “Public finance in models of economic growth”. Review of Economic Studies59: 645–661
12.
BarroR (1990) “Government spending in a simple model of endogenous growth”. Journal of Political Economy98: S103–S125
13.
BasileRNardisSGirardiA (2001) “Regional inequalities and cohesion policies in the European Union”, RomeWP 23, Institute for Studies and Economic Analyses
14.
BaumolWWolffE (1988) “Productivity growth, convergence, and welfare: reply”. American Economic Review78: 1155–1159
15.
BeckerSEggerPEhrlichM (2010) “Going NUTS: the effect of EU Structural Funds on regional performance”. Journal of Public Economics94: 578–590
16.
BeugelsdijkMEijffingerS (2005) “The effectiveness of structural policy in the European Union: an empirical analysis for the EU-15 in 1995-2001”. Journal of Common Market Studies43: 37–51
17.
BoldrinMCanovaF (2001) “Inequality and convergence in Europe's regions: reconsidering European regional policies”. Economic Policy16: 205–253
18.
BorotaTKutanA (2008) “Regional integration and economic growth: the case of the European Union”. The Journal of International Trade and Diplomacy2: 93–113
19.
Bouvet F, 2005, “European Union regional policy: allocation determinants and effects on regional economic growth”, working paper, Department of Economics, University of California, Davis, CA
20.
BouvetFDall'erbaS (2010) “European regional structural funds: how large is the influence of politics on the allocation process?”. Journal of Common Market Studies48: 501–528
21.
Bradley J, Mitze T, Morgenroth E, Untiedt G, 2006, “How can we know if EU cohesion policy is successful? Integrating micro and macro approaches to the evaluation of Structural Funds”, WP 1-2006, Gesellschaft für Finanz- und Regionalanalysen, Münster
22.
BurnsideCDollarD (1997) “Aid spurs growth: in a sound policy environment”. Finance and Development34(4): 4–7
23.
CappelenACastellaciFFagerbergGVerspagenB (2003) “The impact of EU regional support on growth and convergence in the European Union”. Journal of Common Market Studies41: 621–644
24.
CaprosPKaradeloglouP (1989) “Macroeconomic impacts of structural funds on the Greek economy”, Athens: Institute of Economic and Industrial Research
25.
CEC, Commission of European Communities, Brussels 1997 First Report from the Commission on Economic and Social Cohesion 2001 Second Report on Economic and Social Cohesion 2004 Third Report on Economic and Social Cohesion
26.
ChecheritaCNickelCRotherP (2009) “The role of fiscal transfer for regional economic convergence in Europe”, FrankfurtWP 1029, European Central Bank
27.
ChristodoulakisNKalyvitisS (1998) “The second CSF (Delors' II Package) for Greece and its impact on the Greek economy: an ex-ante assessment using a macroeconometric model”. Economic Change and Restructuring31: 57–79
28.
CliffA DOrdJ K (1973) Spatial Autocorrelation, London: Pion
29.
Courtney P, Errington A, 2003, “Small towns as ‘sub-poles’ in European rural development: policy, theory and methodology”, paper presented at the Agricultural Economics Society Annual Conference, University of Plymouth, 11–14 April; copy available from authors, Countryside and Community Research Institute, University of Gloucestershire, Gloucester
30.
CrescenziRRodríguez-PoseA (2012) “Infrastructure and regional growth in the European Union”. Papers in Regional Science91: 487–513
31.
Crespo-CuaresmaJDimitzM ARitzberger-GrünwaldD (2008) “Growth, convergence and EU membership”. Applied Economics40: 643–656
32.
Dall'erbaS (2005) “Distribution of regional income and regional funds in Europe 1989–1999: an exploratory spatial data analysis”. The Annals of Regional Science39: 121–148
33.
Dall'erbaSLe GalloJ (2008) “Regional convergence and the impact of European structural funds over 1989–1999: a spatial econometric analysis”. Papers in Regional Science87: 219–244
34.
Dall'erbaSGuillainRLe GalloJ (2007) “The impact of structural funds on regional growth: how to reconsider a 7 year-old black-box”. Région et Développement30: 77–100
35.
De la Fuente A, 2002, “Does cohesion policy work? Some general considerations and evidence from Spain”, paper presented at the Conference on Income Convergence and Regional Policy, Bertelsmann Foundation, World Bank and Fundación CIDOB, October
36.
De la FuenteAVivesX (1995) “Infrastructure and education as instruments of regional policy: evidence from Spain”. Economic Policy10(20): 11–51
37.
EderveenSGorterJMooijRNahuisR (2003) “Funds and games: the economics of European cohesion policy”. OP 3, European Network of Economic Policy Research Institutes, October
38.
EderveenSde GrootHNahuisR (2006) “Fertile soil for structural funds? A panel data analysis of the conditional effectiveness of European Cohesion Policy”. Kyklos59: 17–42
39.
EggertWvon EhrlichMFengeRKaonigG (2007) “Konvergenz- und Wachstumseffekte der europäischen Regionalpolitik in Deutschland”. Perspektiven der Wirtschaftspolitik8: 130–146
40.
EspostiRBussolettiS (2008) “Impact of Objective 1 funds on regional growth convergence in the European Union: a panel-data approach”. Regional Studies42: 159–173
41.
European Commission (2008) “EU Cohesion policy 1988–2008: investing in Europe's future”, Brussels: Inforegio Panoramapaper 26
42.
EzcurraRRapúnM (2006) “Regional disparities and national development revisited: the case of Western Europe”. European Urban and Regional Studies13: 355–369
43.
FalkMSinabelF (2008) “The effectiveness of Objective 1 structural funds in the EU 15: new empirical evidence from NUTS 3 regions”, Wienpaper 310, Austrian Institute of Economic Research
FayolleJLecuyerA (2000) “Regional growth, national membership and European structural funds: an empirical appraisal”, Paris: Observatoire Français des Conjonctures Économiquesdocument no 2000-02
46.
FiaschiDLavezziAParentiA (2011) “Productivity growth across European regions: the impact of structural and cohesion funds”, Palermo: University of Palermoworking paper
47.
FriedmannM (1969) The Optimum Quantity of Money, Chicago, IL: Aldine
48.
FujitaMThisseJ-F (1996) “Economics of agglomeration”. Journal of the Japanese and International Economies10: 339–378
49.
GallupJSachsJMellingerA (1998) “Geography and economic development”, Cambridge, MA: National Bureau of Economic ResearchWP 6849
50.
García-MiláTMcGuireT (2001) “Do interregional transfers improve the economic performance of poor regions? The case of Spain”. International Tax and Public Finance8: 281–296
51.
GripaiosPBishopP (2008) “Analyzing the impact of Objective 1 funding in Europe: a review”. Environment and Planning C: Government and Policy26: 499–524
52.
HarrisC D (1954) “The market as a factor in the localization of industry in the United States”. Annals of the Association of American Geographers44: 315–348
53.
HicksNStreetenP (1979) “Indicators of development: the search for a basic needs yardstick”. World Development7: 567–580
54.
HirschmanA O (1958) The Strategy of Economic Development, New Haven, CT: Yale University Press
55.
HsiaoC (1985) “Benefits and limitations of panel data”. Econometric Reviews4: 121–174
56.
IoannidesIPetrakosG (2000) “Regional convergence-divergence trends in Greece: an assessment on the basis of the performance of three regions”. European Investment Bank Papers5: 31–58
57.
KaranikolasPMartinosN (2007) “The modernization process in Greek agriculture: the case of investment aid”. Agricultural Economics Review8: 37–49
58.
KeebleDOwensLThompsonC (1982) “Regional accessibility and economic potential in the European Community”. Regional Studies16: 419–432
59.
KrugmanP (1991) “Increasing returns and economic geography”. Journal of Political Economy99: 483–499
60.
KuznetsS (1955) “Economic growth and income inequality”. American Economic Review45: 1–28
61.
LolosS (2001) “The macroeconomic effect of EU structural transfers on the cohesion countries and lessons for the CEECs”, Laxenburgreport, International Institute for Applied Systems Analysis
62.
LolosS (2009) “The effect of EU structural funds on regional growth: assessing the evidence from Greece, 1990–2005”. Economic Change Restructuring42: 211–228
63.
LolosSSuwa-EisenmannAZonzilosNBourguignonF (1995) “Evaluating the CSF with an extended computable general equilibrium model: the case of Greece (1988–1995)”. Journal of Policy Modeling17: 177–197
64.
LucasE (1988) “On the mechanics of economic development”. Journal of Monetary Economics22: 3–42
65.
LyberakiA (2004) “Changing labour markets and their implication for social protection”. In: CarlosM (eds) The Challenge of Social Policy Reform in the 21st Century: Towards Integrated Systems of Social Protection, Athens: Sideris and Kokkalis Foundation, pp. 85–104
66.
MartinP (1998) “Can regional policies affect growth and geography in Europe?”. The World Economy21: 757–774
67.
MartinP (1999) “Public policies, regional inequalities and growth”. Journal of Public Economics73: 85–105
68.
MartinPRogersC A (1995) “Industrial location and public infrastructure”. Journal of International Economics39: 335–351
69.
Midelfart-KnarvikHOvermanH (2002) “Delocation and European integration: is structural spending justified?”. Economic Policy35: 322–359
70.
MohlPHagenT (2008) “Which is the right dose of EU cohesion policy for economic growth?”, MannhelmDP 08-104, Zentrum für Europäische Wirtschaftsforschung GmbH
71.
MohlPHagenT (2009) “Do EU structural funds promote regional growth? Evidence from various panel data approaches”, Barcelonapaper presented in 24th Annual Congress of the European Economic Association, 23–27 August, http://www.ub.edu/sea2009.com/Papers/117.pdf
72.
MoranP (1950) “Notes on continuous stochastic phenomena”. Biometrika37: 17–23
73.
MorrisonC JDiewertW E (1990) “Productivity growth and changes in the terms of trade in Japan and the United States”. In: HultenC R (eds) Productivity Growth in Japan and the United States, Chicago, IL: University of Chicago Press, pp. 201–227
74.
MyrdalG (1957) Economic Theory and Underdeveloped Regions, London: Methuen
75.
PercocoM (2005) “The impact of Structural Funds on the Italian Mezzogiorno 1994–1999”. Région et Développement21: 141–153
76.
PereiraA M (1999) “International public transfers and convergence in the European Union”. Public Finance Review27: 194–219
77.
PetrakosG (2000) “Spatial impact of East–West integration”. In: PetrakosGMaierGGorzelakG (eds) Integration and Transition in Europe, London: Routledge, pp. 38–68
78.
PetrakosGPsycharisG (2004) Regional Development in Greece, Kritiki, Athens(in Greek)
PetrakosGKalliorasDAnagnostouA (2011) “Regional convergence and growth in Europe: understanding patterns and determinants”. European Urban and Regional Studies18: 375–391
81.
PorterM E (2000) “Location, competition, and economic development: local clusters in a global economy”. Economic Development Quarterly14: 15–35
82.
PsaltopoulosDBalamouEThomsonK (2006) “Rural–urban impacts of CAP measures in Greece: an inter-regional SAM approach”. Journal of Agricultural Economics57: 441–458
83.
PugaD (2002) “European regional policies in light of recent location theories”. Journal of Economic Geography2: 373–406
84.
Puigcerver-PeñalverM (2007) “The impact of structural funds policy on European regions' growth: a theoretical and empirical approach”. The European Journal of Comparative Economics4: 179–208
85.
QuahD (1993) “Empirical cross-section dynamics in economic growth”. European Economic Review37: 426–434
86.
RamajoJMárquezMHewingsGSalinasM (2005) “Spatial heterogeneity and interregional spillovers in EU: some evidence about the effects of cohesion policies on convergence”. European Economic Review52: 551–567
87.
Rodríguez-PoseA (2000) “Economic convergence and regional development strategies in Spain: the case of Galicia and Navarre”. European Investment Bank Papers5: 89–115
88.
Rodríguez-PoseAFratesiU (2004) “Between development and social policies: the impact of European structural funds in Objective 1 regions”. Regional Studies38: 100–113
89.
Rodríguez-PoseAFratesiU (2007) “Explaining the scarce returns of European structural policies from a new economic geography perspective”. In: FingletonB (eds) New Directions in Economic Geography: New Horizons in Regional Science, Cheltenham, Glos: Edward Elgar, pp. 338–358
90.
Rodríguez-PoseAPsycharisYTseliosV (2012) “Public investment and regional growth and convergence: evidence from Greece”. Papers in Regional Science91: 543–568
91.
Sala-i-MartinX (1996) “Regional cohesion: evidence and theories of regional growth and convergence”. European Economic Review40: 1325–1352
92.
SolowR (1956) “A contribution to the theory of economic growth”. Quarterly Journal of Economics70: 65–94
93.
Suarez-VillaL (1989) The Evolution of Regional Economies: Entrepreneurship and Macroeconomic Change, Westport, CT: Praeger
94.
TondlG (2001) Convergence After Divergence? Regional Growth in Europe, Wien: Springer
95.
VickermanR W (1996) “Restructuring transport networks”. European Journal of Regional Development3: 16–26
