The Impact of EU Accession in Romania: An Analysis of Regional Development Policy Effects by a Multiregional I-O Model

Table 8. Sector variability calculated by region, Romania.

VC = Variation Coefficient calculated as a percent ratio between standard deviation and average on all sectors. VC (1) and VC (2) are calculated
before and after policy application, respectively

VCs = VC calculated on all sectors aggregated over all regions

VCr = VC calculated on all regions

VCsr = VC calculated on all sectors of all regions

Source: Author’s elaboration

4 Concluding remarks

This paper has estimated employment and labour income impact in Romania deriving from
application of development policies (rural development policy, structural funds and cohesion funds)
defined in the proposed EU accession financial package for the period 2007-09. Impacts have been
estimated by the use of a multiregional I-O model. Results show that policy will lead to large positive
effects. Income and employment variations will be 2,425 million euro (2000 prices) and about 1.4
million of labour units, respectively. Moreover, variation of income per capita will be 108 €. In
comparison to 2000 data, increases will be by 16%, as for income, and by 17%, as for employment.

Sectors which will mostly benefit from impacts are services and industry, in terms of income, and
agriculture, with reference to employment. This last result can be partly explained by the fact that
Romania is still a developing country in which agriculture, although is losing its importance, still plays
a significant role in the economy especially in terms of employment, as the high agricultural
employment multipliers demonstrate.

In terms of effectiveness, policy produces an increase in income by 32% of public expenditure
and in employment by 183 labour units for each one million euro. Moreover, policy would seem to be
able to reduce disparities existing among regions and sectors, leading towards more uniform
development, but only in terms of income since, at an employment level, differences would seem to
increase.

At a sub-national level, consistently with the declared policy objectives of sustaining the less
developed areas, the South and the North-East regions are those on which impacts tend to concentrate
and those which grow to a bigger extent. Analysing ratio impacts-public expenditure, the best policy
results are produced in the Bucharest region, in terms of income, and in the South region, in terms of
employment. In line with results at an aggregate level, income disparities among sectors tend to
decrease in all the regions. On the contrary, at an employment level, different from what can be
noticed at a national level, there is general trend towards a reduction of differences.

From a methodological point of view, two points deserve to be discussed. Firstly, in this research,
a three-stage estimation method for deriving multiregional I-O tables has been developed and applied.
This method is relatively straightforward and guarantees internal consistency. It can be included in the
category of hybrid methods of building multiregional I-O tables, since it is based on non-survey
techniques to produce a preliminary estimate of intraregional and interregional I-O coefficients and, in
addition, allows the analyst to insert all available exogenous information finalised to improve the
reliability of the multiregional I-O table. Secondly, it is clear that impact results are strongly affected
by hypotheses on regional and sectoral distribution of funds. A different distribution would lead to

13

<<   <   11   12   13   14   15   16   >   >>