Undermining the principle of concentration? EU development policies and the socio-economic disadvantage of European regions

Abstract

The distribution of the EU structural funds to assisted regions might have been à priori distorted by either political equilibriums or inaccurate assumptions over their most cost-effective allocation. A little correlation between expenditure and socio-economic disadvantage, by undermining the principle of concentration, might have reduced the impact of the EU structural funds on economic and social cohesion. The empirical analysis shows that the sources of disadvantage are more spatially concentrated than the funds devoted to compensating such disadvantage and uncovers, by means of a Heckman two-step selection model, a weak association between structural disadvantage and EU funding.