Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/317439 
Year of Publication: 
2020
Citation: 
[Journal:] Journal of Business Economics and Management (JBEM) [ISSN:] 2029-4433 [Volume:] 21 [Issue:] 5 [Year:] 2020 [Pages:] 1390-1410
Publisher: 
Vilnius Gediminas Technical University, Vilnius
Abstract: 
Significant disparities still exist between regions of the European Union, even though substantial Cohesion investments are directed to address this issue. To adjust the Cohesion Policy (CP), researchers assess the returns of the CP, but almost all studies are carried out at NUTS1&2 or a country level, even though significant disparities occur at NUTS3 level. Moreover, just a few studies examine the non-linear effects of the CP, and none of them covers the NUTS3 disaggregation level. Filling the gap of previous contributions, the paper aims to investigate convergence outcomes of the CP at NUTS2&3 level and to identify whether the marginal effect of the CP is diminishing. The estimation strategy is based on the modified specification of the difference-in-differences estimator that has an advantage while examining policy effects, using non-experimental data. Based on research findings, the essential guidelines for the improvement of the CP can be drawn up: i) the distribution policy of Cohesion investments should focus on smaller territorial units to reduce disparities at NUTS3 level; ii) the intensity of the CP's transfers has to be optimised because excessive intensity does not provide a positive return.
Subjects: 
Cohesion Policy
Cohesion investments
regional disparities
convergence
diminishing return
NUTS2
NUTS3
JEL: 
O47
O52
R11
R12
R15
R58
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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