María Teresa Álvarez-Martínez

The Effects of European Structural Funds in the Spanish Regions Using CGE Models: a review

This paper reviews the few regional studies on the impact of European Structural funds in Spain using Computable General Equilibrium (CGE) Models. While the models in these studies are widely used to evaluate the effects of very different public policies, they rarely have been used to quantify the impact of the Structural funds. In the pioneer papers elaborated for Madrid and Andalusia, the effects of the funds have been simulated through an exogenous change of final demand. I suggest avoiding any accounting of exogenous shocks in final demand of non-affected sectors by more-realistically splitting investment into various capital goods and evaluating the short-run effects of increasing investment in them.