The updated RHOMOLO impact assessment of the 2014-2020 European cohesion policy (including REACT-EU)

Casas, Pablo and Christou, Tryfonas and García Rodríguez, Abián and Heidelk, Tillmann and Lazarou, Nicholas Joseph and Monfort, Philippe and Salotti, Simone (2024): The updated RHOMOLO impact assessment of the 2014-2020 European cohesion policy (including REACT-EU).

Abstract

We analyse the macroeconomic impact of the European cohesion policy investments deployed during the 2014-2020 programming period on the basis of simulations carried out with the spatial dynamic general equilibrium model called RHOMOLO. We use the latest data on actual expenditures including the €50 billion falling under the REACT-EU programme extending the response to the COVID-19 crisis. We quantify the direct and indirect effects of the policy in the NUTS 2 regions of the European Union within a 20-year time frame. The results suggest that the impact of the policy is sizeable, especially in the less developed regions. Accordingly, regional disparities are shown to decrease due to the policy intervention. The investments have a positive impact on the European GDP, which is almost 0.6% higher in 2023 compared to a scenario without cohesion policy.

• Item Type: MPRA Paper
• Language: English
• Keywords: Cohesion policy, REACT-EU, regional growth, regional development, general equilibrium modelling.
• Subjects: C - Mathematical and Quantitative Methods > C6 - Mathematical Methods ; Programming Models ; Mathematical and Simulation Modeling > C68 - Computable General Equilibrium Models; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R13 - General Equilibrium and Welfare Economic Analysis of Regional Economies

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