New Directions in Economic Geography

New Directions in Economic Geography

New Horizons in Regional Science series

Edited by Bernard Fingleton

This important book explores original and alternative directions for economic geography following the revolution precipitated by the advent of so-called ‘new economic geography’ (NEG). Whilst, to some extent, the volume could be regarded as part of the inevitable creative destruction of NEG theory, it does promote the continuing role of theoretical and empirical contributions within spatial economic analysis, in which the rationale of scientific analysis and economic logic maintain a central place. With contributions from leading experts in the field, the book presents a comprehensive analysis of the extent to which NEG theory is supported in the real world. By exploring whether NEG theory can be effectively applied to provide practical insights, the authors highlight novel approaches, emerging trends, and promising new lines of enquiry in the wake of advances made by NEG.

Chapter 12: Explaining the Scarce Returns of European Structural Policies from a New Economic Geography Perspective

Andrés Rodríguez-Pose and Ugo Fratesi

Subjects: economics and finance, regional economics, urban economics, geography, economic geography, urban and regional studies, regional economics, urban economics

Extract

Andrés Rodríguez-Pose and Ugo Fratesi 12.1 INTRODUCTION European regional support has grown in parallel with European integration. Every recent stage of the integration process has been accompanied by a renewal and an important increase in the funds aimed at tackling disparities within the European Union (EU). Overall, the funds targeted at achieving greater economic and social cohesion and reducing disparities within the European Union (EU) have more than doubled in relative terms since the reform of the Structural Funds in 1989, making regional development policies the second most important policy area in the EU, behind the Common Agricultural Policy (CAP). However, and despite a few successes, such as Ireland – that cannot be exclusively attributed to the impact of European structural policies (Barry, Bradley and Hannan, 2001) – almost two decades after the wholesale reform of the European Structural Funds, there is a growing number of voices that have started to question their capacity to deliver the objective of greater economic and social cohesion (RodríguezPose, 2000; Vanhoudt, Mathä and Smid, 2000; Boldrin and Canova, 2001; Puga, 2002; Midelfart-Knarvik and Overman, 2002; Rodríguez-Pose and Fratesi, 2004). The grounds on which these criticisms are supported are related to the absence of regional convergence across Europe (Boldrin and Canova, 2001; Puga, 2002), the relative lack of economic dynamism of a large number of regions with the highest level of support – the so-called Objective 1 regions – (Rodríguez-Pose and Fratesi, 2004), and the conflict between Structural Fund objectives and other European...

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