Cohesion Policy of the European Union and Parameterization of the Level of Development and Hysteresis of Regions

Abstract

The European Union connects the level of development of regions and the intensity of economic funds distribution with Gross Domestic Product (GDP). At the same time it is recognized that the GDP cannot constitute an indicator of mapping out policy in all sectors. In the present paper, an indicator of hysteresis of regions is developed (Regions Hysteresis Index, RHI) based on the fact that it is proposed for the distribution of economic funds of National Strategic Reference Framework (NSRF) in the Greek regions in order to decrease harmoniously their hysteresis. Alternative solutions of distribution of economic funds are evaluated, as the Gross Domestic Product (GDP), the Indicator of Human Development Index (HDI), the Composite Index of Prosperity and Development (CIPD) and the Vulnerability Index (VI). As the environment constitutes a pillar of Sustainable Development, the paper also presents a Regional Index of Environmental Deficiency (RIED) which can be used to determine the needs of regions in funds. The RIED methodology is considered to offer an efficient tool for rational decisions that will tend to balance the environmental inequalities among regions. Keywords: European Union, regional development, sustainable development, hysteresis, inequalities, indicators of prosperity and development, environmental deficienc