On the road to regional 'Competitive Environmental Sustainability': the role of the European structural funds

We construct a novel indicator of regional competitive sustainability based on the movements over time of employment sectoral shares across all the regions of the European Union. The indicator accounts for shifts in employment towards greener and more productive sectors over the 2008-2018 period. The mapping of the indicators shows considerable regional heterogeneity in terms of both competitiveness and environmental sustainability, as well as interesting dynamics over time. We also present an econometric analysis of the determinants of these sectoral shifts. It appears that the European structural funds are positively associated with the transition to a more competitive and sustainable economy at the regional level. This is particularly true for the competitive dimension of the transition, with the funds being positively associated with a regional employment restructuring towards more productive sectors.