Tuesday, June 25, 2013
2.03 (Binnengasthuis)
Against the background of the financial crisis and austerity measures, new ideas were put forward to reform cohesion policy to enhance its effectiveness and the return on investment. One of them are the financial engineering instruments, such as JESSICA initiative for urban development or JEREMIE for supporting small and medium enterprises, which are expected to offer a means to ‘do more with less’ in this difficult budgetary context. In fact, financial engineering instruments allow for leveraging additional private capital for investment in economic development at the sub-national level and have the potential to increase the sustainability and effectiveness of interventions thanks to their revolving nature. Thus, the shift away from a grant-based support towards revolving funding, whereby assistance is offered in the form of refundable loans or guarantees marks a radical change, the effects of which have not yet been investigated.
This study bridges an important research gap by investigating the impacts of the JESSICA initiative on the cooperation between territorial administration and financial and private sector actors in Poland and Czech Republic. By examining the mechanisms of adjustment to this new policy tool the study contributes to the wider literature on multi-level governance and sheds new light on the transformations of horizontal governance in regions in the context of the crisis. Moreover, it is a timely contribution to the policy debate, as the current round of implementation of JESSICA serves as a test-bed for the widespread use of financial engineering as a mainstream instrument in cohesion policy post-2013.
