Determinants of Intra-Distribution Dynamics in European Regions: An Empirical Assessment of the Role of Structural Intervention

This paper examines the dynamic of income distribution in European regions and attempts to relate movements within this distribution to regional structural characteristics and to the impact of cohesion policy (CP). There is evidence that CP supports advanced economic development in lagging and peripheral regions, hence contributing to the ‘convergence objective’. The effectiveness of CP, however, depends on the manner in which funds are managed by single regions: the likelihood of progressing in the income distribution is associated, in fact, to the balance between investments in infrastructure and the productive environment, favouring the former. Evidence presented in this paper also relates regional economic performance to the educational level and innovation in regions, providing useful insights for the current debate about reshaping EU cohesion policy toward a more place-based approach.