General Information

The Impact of European Integration and Enlargement on Regional Structural Change and Cohesion, financed by the EU 5th Framework Program for Research and Technology, 2002-2004.

Overall Objective

The overall scientific objective of EURECO was to identify and explain in a cross-country analysis the impact of European integration and enlargement on regional structural change and cohesion. The project provided empirical evidence about the relationship between industrial location, regional specialisation and regional income per capita in the context of European integration and EU enlargement. The research results will help identify challenges and recommendations for the regional policy at the European, national and local levels.

Detailed Objectives

In order to achieve the overall objective, the project examined the experience of current EU Member States to uncover spatial implications of economic integration in general, the experience of accession countries to predict potential spatial implications specific to the envisaged EU enlargement, and the role of foreign direct investment (FDI) as a major engine of the expected restructuring process. Our research aimed at the following detailed objectives:

i) Providing empirical evidence from current EU Member States in a comparative and historical perspective on the effects of economic integration on regional structural change and cohesion. In particular, regional implications of previous enlargements of the EU were analysed with respect to their structural and income effects on the regions of both the then incumbent and accession countries. The countries included in this analysis were: Austria, France, Germany, Greece, Ireland, Italy, Portugal, Spain, and the United Kingdom. The research results in this part were used to assess whether regional cohesion and regional stability in Europe will increase or decrease as a result of the EU enlargement and what type of regions are likely to become winners or losers in this process.

ii) Providing empirical evidence from the accession countries about the impact of the economic integration with the EU on regional structural change and cohesion in these countries. In particular, we investigated how the trade re-orientation towards the EU has affected the location and re-location of industrial activity, patterns of regional specialisation, regional income, and cohesion in Bulgaria, the Czech Republic, Hungary, Poland, Romania and Slovakia. The research results in this part were used to assess the potential winning and losing regions in these countries in the process of their economic integration with the EU.

iii) Providing empirical evidence about the role of foreign direct investment (FDI) in fostering agglomeration of economic activities and regional structural change. In particular, we assessed the influence of FDI on the currently ongoing process of market integration between EU and accession countries, and the changes brought by FDI on the spatial distribution of economic activities. Given the prominent role FDI played in the restructuring process of Ireland after its EU accession, the Irish experience will also be examined and used as a benchmark. This part of the project analysed, in particular, the specific influence FDI exerts on the integration of rather heterogeneous regions, the way it shapes industrialisation patterns between accession countries and incumbent Member States and within them at regional level and whether these patterns are due to endogenous core-periphery patterns or other location factors such as local comparative advantages.

iv) Based on the results from the empirical analysis, identifying policy challenges and recommendations for the regional policy at the European, national and regional level which are aimed at accommodating the spatial economic changes predicted to be brought by the EU enlargement on both current EU Member States and accession countries.

Partner No	Organisation name	Scientist responsible
1	Center for European Integration Studies, University of Bonn (ZEI)	Dr. Iulia Traistaru
2	Institute for World Economics, Kiel (IfW)	Prof. Dr. Rudiger Soltwedel
3	University "Luigi Bocconi", Milan (UNIBOC)	Dr. Laura Resmini
4	Economic and Social Research Institute , Dublin(ESRI)	Dr.Edgar Morgenroth
5	University of Thessaly, Volos (UTH)	Prof. Dr. George Petrakos
6	Institute of World Economics, Hungarian Academy of Sciences (IWE)	Prof. Dr. Andras Inotai
7	Institute of Economics, Bulgarian Academy of Sciences (BAS)	Dr. Stoyan Totev

Duration of the Project: November 2002 – October 2005

No Workpackage	Title	Lead partnerNo.	Start month	End month	Deliverable No
1	Comprehensive theoretical and methodological framework	1	0	5	1.1
2	Regional structural change and cohesion in the EU	2	6	29	2.1, 2.2,2.3
3	Regional structural change and cohesion in accession countries	5	6	29	3.1, 3.2, 3.3
4	The role of FDI in the re-location of industrial activities	3	6	29	4.1, 4.2,4.3
5	Policy implications for the EU enlargement	4	30	35	5.1, 5.2, 5.3

No.	Deliverable title and description	Scientist responsible
1.1	Literature review	Iulia Traistaru
2.1	Working papers on country analyses (EU Member States)	Christiane Krieger-Boden, Eckhardt Bode
2.2	Research report on regional structural change and cohesion in the EU (cross-country analysis)	Christiane Krieger-Boden, Eckhardt Bode
2.3	Journal article on regional structural change and cohesion in the EU	Rudiger Soltwedel, Christiane Krieger-Boden, Eckhardt Bode
3.1	Working papers on country analyses (accession countries)	Tamas Szemler
3.2	Research report on European integration, regional structural change and cohesion in accession countries (cross -country analysis)	Iulia Traistaru, Stoyan Totev
3.3	Journal article on industrial location and regional specialisation in accession countries	George Petrakos, Iulia Traistaru, Stoyan Totev
4.1	Working papers on country analyses	Anna Wisniewski
4.2	Research report on the role of FDI in re-locating industrial activity	Laura Resmini, Andrea Szalavetz
4.3	Journal article on the role of FDI in re-locating industrial activity	Laura Resmini, Edgar Morgenroth
5.1	Policy papers on the spatial implications of the EU enlargement on EU Member States and accession countries	John Bradley, Andras Inotai
5.2	Policy paper on the role of the FDI in promoting regional development	Laura Resmini, Edgar Morgenroth
5.3	Edited book on spatial economic implications of the EU enlargement	Juergen von Hagen, Iulia Traistaru

Official meetings
Month 5: Inception Workshop, Bonn
Month 18: Content co-ordinating workshop, Volos, Greece (Intermediate results, Workpackages 2, 3 and 4)
Month 26: Content co-ordinating workshop, Milan (Final results Workpackages 2, 3 and 4)
Month 35: Final conference, Brussels

For more information: www.zei.de/eurec/eureco.htm