Enterprise support policy and territorial cohesion: The Czech Republic (2007-2013)

Abstract

The intention of this paper is to evaluate whether the spatial distribution of Structural Funds (SF) for enterprise support interventions follows the relevant territorial cohesion objectives specified in the strategic documents of the Czech Republic in the programming period 2007-2013. The evidence provided suggests mixed results. A relatively high SF allocation to the regions, characterized by strong agglomeration economies and a strong entrepreneurial climate, supports the competitiveness objective, particularly for innovation-oriented interventions. Nevertheless, little support is given to the objective of balanced development because socio-economically disadvantaged regions do not receive a higher SF allocation, in particular traditional industrial regions suffering from industrial decline, high unemployment and with a poor entrepreneurial climate. In this regard, the absorption capacity concept is emphasized as being important for explaining the spatial distribution of SF.