The impact of EU Objective 1 funds on regional development: Evidence from the U.K. and the prospect of Brexit
Year: 2017
Type: article
Abstract: Brexit means that regions of the United Kingdom will lose access to the EU Cohesion Policy. Have EU funds been effective, and what might be the consequences of an interruption of EU financial support? This paper studies the impact of “Objective 1” funding—the highest form of EU aid—in Cornwall and South Yorkshire, two of the U.K.’s most subsidized regions. Counterfactual methodologies assessing their labor market and economic performance provide evidence of a positive effect of EU Objective 1 funds. When in 2006 South Yorkshire lost Objective 1 eligibility, this massively reduced its share of EU funds and the region was unable to sustain the gains obtained in previous years. This suggests that while Structural Funds may be effectively improving socio‐economic conditions of poorer regions, the performance of subsidized areas could be deeply affected by a reduction (or worse, an interruption) of EU aid.
Source: Journal of Regional Science
DOI: 10.1111/jors.12337
Author: Marco Di Cataldo
Institution: London School of Economics and Political Science
Language: English
Field: Social Sciences
Domain: Social Sciences
Open Access status: bronze
OpenAlex ID: W2592384994