The Impact of Regional Support on Growth and Convergence in the European Union

regional, growth, convergence, European Union

Productivity, R&D spillovers and trade

That innovation and diffusion of technology drives long run productivity growth is by now commonly accepted. The crucial question is how. For instance, what is the role of own R&D in the firm, industry or country, as opposed to R&D done elsewhere? Is the former a precondition for rapid productivity growth, or is it possible to prosper by exclusively relying on imported technology? These are questions of high theoretical and practical importance. But the answers are not so clear yet. In fact, as we will show in the next section, the existing evidence points in very different directions. Can this conflicting evidence be reconciled to give a consistent picture? This is the question we address in this paper. We do this in two steps. First, we consider the different theoretical approaches, the empirical relationships they entail, and the related evidence. Then we present a comprehensive data set, consisting of 1974 - 1992 annual data for 14 countries and 22 manufacturing industries, which we use to discriminate between some of the most popular arguments in this area, and to explore the reasons behind some of the conflicting evidence presented in the existing empirical literature. We discuss the findings and implications in the concluding section

The impact of regional support on growth and convergence in the European Union

The tendency towards regional convergence that characterised most of the member states of the European Union from the 1950s onwards came to an end around 1980. To the extent that there has been any tendency towards convergence since then, it has been at the country level, related to the catch up by the relatively poor Southern countries that joined the EU during the 1980s. Within countries, however, there has at best been a standstill. A particularly challenging question is to what extent regional support from the EU, designed to help catch-up by relatively poor regions, has had a real impact on this situation. The EU Structural Funds were reformed in 1989. The objective was to make the funds more effective in reducing the gap between advanced and less-advanced regions and strengthening economic and social cohesion in the European Community. Since 1989 the financial resources allocated to these funds have doubled in real terms. The evidence presented in this paper suggests that this reform may have succeeded in improving EU regional policy so that it becomes more effective in its aim, to generate growth in poorer regions and contribute to greater equality in productivity and income in Europe. However it needs to be emphasised that there also are diverging factors at play. For instance, the estimates obtained for the empirical growth model used in this paper suggest that growth in poorer regions is greatly hampered by an unfavourable industrial structure (dominated by agriculture) and lack of R&D. Hence, to get the maximum out of the support, this needs to be accompanied by policies that facilitate structural change and increase R&D capabilities in poorer regions. Such policies must necessarily be of a long-term nature

Phenotypic plasticity of carbon fixation stimulates cyanobacterial blooms at elevated CO2

Although phenotypic plasticity is a widespread phenomenon, its implications for species responses to climate change are not well understood. For example, toxic cyanobacteria can form dense surface blooms threatening water quality in many eutrophic lakes, yet a theoretical framework to predict how phenotypic plasticity affects bloom development at elevated pCO2 is still lacking. We measured phenotypic plasticity of the carbon fixation rates of the common bloom-forming cyanobacterium Microcystis. Our results revealed a 1.8- to 5-fold increase in the maximum CO2 uptake rate of Microcystis at elevated pCO2, which exceeds CO2 responses reported for other phytoplankton species. The observed plasticity was incorporated into a mathematical model to predict dynamic changes in cyanobacterial abundance. The model was successfully validated by laboratory experiments and predicts that acclimation to high pCO2 will intensify Microcystis blooms in eutrophic lakes. These results indicate that this harmful cyanobacterium is likely to benefit strongly from rising atmospheric pCO2

Cyanobacterial blooms

Cyanobacteria can form dense and sometimes toxic blooms in freshwater and marine environments, which threaten ecosystem functioning and degrade water quality for recreation, drinking water, fisheries and human health. Here, we review evidence indicating that cyanobacterial blooms are increasing in frequency, magnitude and duration globally. We highlight species traits and environmental conditions that enable cyanobacteria to thrive and explain why eutrophication and climate change catalyse the global expansion of cyanobacterial blooms. Finally, we discuss management strategies, including nutrient load reductions, changes in hydrodynamics and chemical and biological controls, that can help to prevent or mitigate the proliferation of cyanobacterial blooms

How rising CO2 and global warming may stimulate harmful cyanobacterial blooms

Climate change is likely to stimulate the development of harmful cyanobacterial blooms in eutrophic waters, with negative consequences for water quality of many lakes, reservoirs and brackish ecosystems across the globe. In addition to effects of temperature and eutrophication, recent research has shed new light on the possible implications of rising atmospheric CO2 concentrations. Depletion of dissolved CO2 by dense cyanobacterial blooms creates a concentration gradient across the air–water interface. A steeper gradient at elevated atmospheric CO2 concentrations will lead to a greater influx of CO2, which can be intercepted by surface-dwelling blooms, thus intensifying cyanobacterial blooms in eutrophic waters. Bloom-forming cyanobacteria display an unexpected diversity in CO2 responses, because different strains combine their uptake systems for CO2 and bicarbonate in different ways. The genetic composition of cyanobacterial blooms may therefore shift. In particular, strains with high-flux carbon uptake systems may benefit from the anticipated rise in inorganic carbon availability. Increasing temperatures also stimulate cyanobacterial growth. Many bloom-forming cyanobacteria and also green algae have temperature optima above 25 °C, often exceeding the temperature optima of diatoms and dinoflagellates. Analysis of published data suggests that the temperature dependence of the growth rate of cyanobacteria exceeds that of green algae. Indirect effects of elevated temperature, like an earlier onset and longer duration of thermal stratification, may also shift the competitive balance in favor of buoyant cyanobacteria while eukaryotic algae are impaired by higher sedimentation losses. Furthermore, cyanobacteria differ from eukaryotic algae in that they can fix dinitrogen, and new insights show that the nitrogen-fixation activity of heterocystous cyanobacteria can be strongly stimulated at elevated temperatures. Models and lake studies indicate that the response of cyanobacterial growth to rising CO2 concentrations and elevated temperatures can be suppressed by nutrient limitation. The greatest response of cyanobacterial blooms to climate change is therefore expected to occur in eutrophic and hypertrophic lakes