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11 - Infrastructure investments as a tool for regional development policy: lessons from the Spanish evidence

Published online by Cambridge University Press:  22 September 2009

By
Rosina Moreno ,
Enrique López-Bazo  and
Manuel Artís
Edited by
Michael Artis ,
Anindya Banerjee  and
Massimiliano Marcellino
Michael Artis
Affiliation:
European University Institute, Florence
Anindya Banerjee
Affiliation:
European University Institute, Florence
Massimiliano Marcellino
Affiliation:
Università Commerciale Luigi Bocconi, Milan
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Summary

Introduction

Within the European Union interest in the effects of public capital investments on economic development has grown as a result of the increase in funds assigned to finance infrastructure projects in less developed regions in an ongoing attempt to promote the growth and, hence, the convergence and cohesion of the territories of the EU. It is well documented that, in response to the diversity of income and welfare levels prevailing in the Union following the accession of Greece, Spain and Portugal, the European institutions adopted a set of measures to ensure the integration of peripheral areas within the Community. Among these measures, basic infrastructure investments in ‘Objective 1’ regions accounted for 35% of the total expenditure of Structural Funds between 1989 and 1993. The further enlargement of the EU is set to exacerbate regional problems in the Union given that the mean GDP per capita of the new Member States stands at approximately 40% of the EU average. These economies are characterised by a predominance of primary and secondary activities, with industry highly concentrated in specific locations, together with an insufficient infrastructure endowment. A restructuring process is therefore required in order to guarantee suitable conditions for future growth. Those regions which fail to restructure might well pay the price of recession and thus be deprived of the potential for future growth. Only those regions that successfully restructure will have some chance of catching up with their more affluent counterparts.

Type
Chapter
Information
The Central and Eastern European Countries and the European Union , pp. 306 - 332
Publisher: Cambridge University Press
Print publication year: 2006

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