EU Regional Policy Effectiveness
and the Role of Territorial Capital
Ugo Fratesi and Giovanni Perucca
Abstract The present chapter reviews the recent studies of the group of regional and
urban economics on the impact of the European Union regional policy on regional
development. In particular, the focus of the research program is on the identification of
the mechanisms through which the local territorial characteristics mediate the effect
of public investments. Results show a strong relationship between the territorial
capital of regions and the effectiveness of the EU regional policy. This evidence
conveys relevant implications for policy makers. In particular, it suggests that regions
should invest in those assets that are complementary to the ones which they already
have, in order to build a balanced economic system.
Keywords EU regional policy · Territorial capital · Economic resilience
1 Introduction
The European Union (EU) allocates every year about one-third of its budget to
regional policies, i.e., to actions aimed at promoting the development of places in
various fields, from transport infrastructure to ICT, from firms’ competitiveness to
social inclusion. The allocation of funds across regions, however, is not distributed
equally. About 51% of the budget is allocated to less developed regions, i.e., those
with a level of per capita gross domestic product (GDP) lower than 75% of the EU
average. Remaining funds are invested in transition regions (per capita GDP between
75 and 90% of the EU average) and more developed regions (per capita GDP above
90% of the EU average).
This asymmetric allocation of funding mirrors the redistributive principle of
the benefits from economic integration which, since its establishment, guides EU
U. Fratesi · G. Perucca (B)
Architecture, Built Environment and Construction Engineering—ABC Department, Politecnico di
Milano, Milan, Italy
e-mail: giovanni.perucca@polimi.it
© The Author(s) 2020
S. Della Torre et al. (eds.), Regeneration of the Built Environment
from a Circular Economy Perspective, Research for Development,
https://doi.org/10.1007/978-3-030-33256-3_4
29
and the Role of Territorial Capital
Ugo Fratesi and Giovanni Perucca
Abstract The present chapter reviews the recent studies of the group of regional and
urban economics on the impact of the European Union regional policy on regional
development. In particular, the focus of the research program is on the identification of
the mechanisms through which the local territorial characteristics mediate the effect
of public investments. Results show a strong relationship between the territorial
capital of regions and the effectiveness of the EU regional policy. This evidence
conveys relevant implications for policy makers. In particular, it suggests that regions
should invest in those assets that are complementary to the ones which they already
have, in order to build a balanced economic system.
Keywords EU regional policy · Territorial capital · Economic resilience
1 Introduction
The European Union (EU) allocates every year about one-third of its budget to
regional policies, i.e., to actions aimed at promoting the development of places in
various fields, from transport infrastructure to ICT, from firms’ competitiveness to
social inclusion. The allocation of funds across regions, however, is not distributed
equally. About 51% of the budget is allocated to less developed regions, i.e., those
with a level of per capita gross domestic product (GDP) lower than 75% of the EU
average. Remaining funds are invested in transition regions (per capita GDP between
75 and 90% of the EU average) and more developed regions (per capita GDP above
90% of the EU average).
This asymmetric allocation of funding mirrors the redistributive principle of
the benefits from economic integration which, since its establishment, guides EU
U. Fratesi · G. Perucca (B)
Architecture, Built Environment and Construction Engineering—ABC Department, Politecnico di
Milano, Milan, Italy
e-mail: giovanni.perucca@polimi.it
© The Author(s) 2020
S. Della Torre et al. (eds.), Regeneration of the Built Environment
from a Circular Economy Perspective, Research for Development,
https://doi.org/10.1007/978-3-030-33256-3_4
29