Cohesion and Convergence: The Economic Effects of EC Structural Transfers

• Autor(a) principal: Gaspar, Vítor
• Data de Publicação: 1995
• Outros Autores: Leite, António Nogueira
• Tipo de documento: Artigo
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10362/87941

In this paper we analyze the impact that the European Union sponsored structural fund transfer programs have on the growth prospects of recipient countries. Using some aggregate data for Portugal we estimate both the direct and the long run impact of these funds and compare our results with the ones provided by computational dynamic growth models for the Portuguese economy. In addition, we address some of the questions raised by the likely impact of these transfers on the macroeconomic equilibria of recipient countries and look at the corresponding incentive problems for project selection in both the public and private sector. We conclude that the effect of these programs in promoting real convergence will also depend upon the availability of rules reducing rent seeking behavior and the pervasive negative effects often associated with project financing via non-refundable grants.