%N 2
%D 2018
%L eprints3893
%X In this paper, we empirically test the effects of the EU ?cohesion policy? on the performance of
about 500,000 European manufacturing firms after combining regional policy data at NUTS-
2 level with firm-level data. In a framework of heterogeneous firms and different absorptive
capacity of regions, we show that financing of ?cohesion policy? by European Regional Development
Fund (ERDF) aimed at direct investments in R&D correlates with improvement of firms?
productivity in a region. Conversely, funding designed at overall Business Support correlates
with negative productivity growth rates. In both cases, we registered an asymmetric impact
along the firms? productivity distribution, where a stronger impact can be detected in the first
quartile, i.e. less efficient firms in a region. We finally argue that considering the heterogeneity
of firms allows a better assessment of the impact of ?cohesion policy? measures.
%K Keywords: firm performance, total factor productivity, cross-country analysis, convergence,
regional policy.  -  
JEL Classification Numbers: D22, D24, E23, F15, L25.
%A Loredana Fattorini
%A Mahdi Ghodsi
%A Armando Rungi
%I IMT School for Advanced Studies Lucca
%T Cohesion Policy Meets Heterogeneous Firms