EU Regional Policy Effectiveness and the Role of Territorial Capital

The present chapter reviews the recent studies of the group of regional and urban economics on the impact of the European Union regional policy on regional development. In particular, the focus of the research program is on the identification of the mechanisms through which the local territorial characteristics mediate the effect of public investments. Results show a strong relationship between the territorial capital of regions and the effectiveness of the EU regional policy. This evidence conveys relevant implications for policy makers. In particular, it suggests that regions should invest in those assets that are complementary to the ones which they already have, in order to build a balanced economic system.