News

20th August 2012

Emerging from recession? 
Future prospects for the Irish economy 2012-2012

By John Bradley and Gerhard Untiedt

How will Ireland emerge from Recession and what path will the development take? In our recently published paper about the future prospects of the Irish economy we analyse and forecast using the HERMIN model of the Irish economy. The key message is that it will be a painful and slow recovery and that mainly the production side of the economy matters.

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20 June 2012

"Rethinking regional develpment strategy in the context of  structural funds: Lessons from the Irish cross-border region"

By John Bradley and Michael Best

This paper is presented at the Directorate-General Regional Policy - Evaluation Network Meeting, Brussels, June 21-22th 2012. It's also published as HERMIN Economic Paper 3-2012

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15th May 2012

Assessing the impact of EU Cohesion Policy:
What can economic models tell us?

By John Bradley and Gerhard Untiedt

A paper presented at the Bruegel workshop "Assessing the impact of EU cohesion policy" in Brussels in May 2012.

Abstract:

The challenge of evaluating the impacts of cohesion policy lies in the complexity of the public policy instruments being used in terms of individual projects, wider measures, operational programmes and the entire investment package taken as a whole. The goal of cohesion policy – to promote accelerated growth and development in lagging EU member states and regions, i.e. development at the aggregate macroeconomic level – is ambitious and the evaluation of its likely impacts draws on economic and other research that is still at an early stage of evolution. The context within which cohesion policy is designed, implemented and evaluated is also complex and this should serve as a warning against simplistic evaluations and premature judgements.

In the course of cohesion policy impact evaluation there are really only two crucial decisions to be taken. First, do you need to construct an explicit policy counterfactual? Second, if the answer is “yes”, how does one define the counterfactual? If one wishes to identify the specific contribution of a policy action, it would be difficult to answer other than “yes” to the first question. But there are a range of possible answers to the second question.

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31 January 2012

Extended Cohesion System of HERMIN models for all EU-27 member states

On behalf of the European Commission, DG Regional Policy the macroeconomic Cohesion System of HERMIN models (CSHM) will be extended to cover all 27 EU member states.  The general aim of the present project is to extend the coverage of the current 16-country CSHM (and 2 macro-regional models) to cover all 27 EU Member States.  Essentially, this requires the additional modelling of the eleven more advanced states in the manner of, and consistent with the aims and objectives of the original CSHM, namely Austria, Belgium, Denmark, Finland, France, Germany, Italy, Luxemburg, the Netherlands, Sweden and the United Kingdom. Although these eleven additional states are – to a large extent – “net” contributors to the EU budget, they all receive non-zero amounts of assistance in the context of EU-wide cohesion policy.  Of course, these funds are directed mainly at some of their internal, lagging regions, and the amounts of assistance are far smaller than the finance made available to the less developed states. Nevertheless, the Structural Fund investment mechanisms have to be inserted into the eleven new models in order to be in a position to evaluate the impacts on these economies.

The extended version of the CSHM to all EU Member States is designed to be able to:

  • Assess the impact of Cohesion Policy on each Member State of the EU and the two macroregions (Eastern Germany and Mezzogiorno) arising from the Structural and Cohesion fund interventions, including the indirect impact of Cohesion Policy through the trade links and other links.
  • Assess the impact of Cohesion Policy on each Member State of the EU and the two macroregions (Eastern Germany and Mezzogiorno) under different assumptions about co-financing (no co-financing, private and public co-financing).
  • Assess the impact of contributions to the EU budget for Cohesion Policy under different assumptions concerning the Member States contributing to the EU budget (e.g. all Member States or only so-called net contributors).

The extended version of the CSHM will be used to:

  • Simulate the impact of Cohesion Policy for the intervention period from 2014 to 2020 based on the legislative and financial package proposed by the Commission and expected contributions to the EU budget for Cohesion Policy. The simulations will run up to  the year 2030.

The project  ends in December 2012.

30 January 2012

Mid-term evaluation of Cohesion Policy in Lithuania

A new macroeconomic model to measure and evaluate the short and long-term  impact of Cohesion Policy in Lithuania was developed in the course of the mid-term evaluation of Cohesion Policy. The model follows the HERMIN framework, but has a higher sectoral disaggregation than the standard HERMIN five sector model.  It covers 16 sectors, mainly through a division of the manufacturing industries and fulfills the need of evaluation of public policy interventions as the tasks were set by the Lithuanian Ministry of the Economy. This model is based on the same principles as the HERMIN model being used by the European Commission. The design of HERLIT-16 is grounded on the key features of the economic structures.  The full report (in Lithuanian) and a summary (in Englisch) can be downloaded via:

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19 March 2011

The Future of EU Cohesion Policy in a Time of Austerity

By John Bradley and Gerhard Untiedt

A paper presented at an international conference in Vilnius in March 2011.

Abstract: Unlike the single European market and the single currency, EU Cohesion Policy – reformed at the end of the 1980s - has never been the subject of as rigorous an investigation about its foundations and implications as the other two policy initiatives. As a result the cycle consisting of design, implementation, monitoring and evaluation of cohesion policies shows severe weaknesses, especially at the microeconomic level. In this paper we look at the different issues that influence EU Cohesion Policy, critique the way the policy cycle is implemented in practice, and conclude that a more rigorous approach is needed to justify the interventions in terms of returns to the investments. A shift from output driven implementation to a design and needs oriented implementation is emphasized.

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