DP3673 The Effect of Structural Fund Spending on the Spanish Regions: An Assessment of the 1994-99 Objective 1 CSF

Author(s): Angel de la Fuente
Publication Date: December 2002
Keyword(s): infrastructure, regional policy, structural funds
JEL(s): E62, H50, R58
Programme Areas: International Macroeconomics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=3673

This Paper analyses the growth and employment effects of the 1994-99 Community Support Framework (CSF) for the Objective 1 Spanish regions, using a simple supply-side model estimated with a panel of regional data. The results suggest that the impact of the Structural Funds in Spain has been quite sizeable, adding around a percentage point to annual output growth in the average Objective 1 region, and 0.4 points to employment growth. Over the period 1994-2000, the Framework has resulted in the creation of over 300,000 new jobs and has eliminated 20% of the initial gap in income per capita between the assisted regions and the rest of the country.