Fostering the potential endogenous development of European regions: a spatial dynamic panel data analysis of the Cohesion Policy

In this paper, we use a conditional-convergence eco nometric model to investigate whether the Cohesion Policy affect the European economies. The main contribution of our study is to consider both spatial and temporal dynamics in assessing the impact of European cohesion policy. Econometric estimations rely on a dataset of 143 EU14-NUTS1/NUTS2 regions from 1980 to 2005. Our results suggest that Objective 1 programmes have a direct effect on regional GDP p.c. growth rates, whereas total structural funds do not. Moreover, consideration of the spatial dimension of the panel brings to light a still significant, but less important, impact of structural funds.