The influence of the local context on the implementation and impact of EU Cohesion Policy

This paper analyzes the impact of the European Union's Cohesion Policy on firm growth in the programming period 2007-13 in seven European countries. Results show that Cohesion Policy support promotes firm growth in size (value added and employment) more than in productivity. However, even when the policy is the same and similar projects and beneficiaries are considered, its effectiveness varies across different territorial contexts, among but also within countries. In several cases, the impact of grants on firm growth is larger in regions with lower income or scant endowments of territorial assets, most likely because firms in those regions cannot rely on external assets.