Public Investment and Regional Resilience: Empirical Evidence from the Greek Regions

This paper examines empirically the contribution of public investment expenditures to regional resilience. Analysis is based on a novel dataset including public investment expenditures data decomposed by sub-categories and disaggregated at NUTS III Greek regions over the period 2000-2017. Results indicate that public investment expenditures had a positive influence on regional resilience during the period of the economic crisis. Decomposing public investment expenditures by type the analysis provides evidence that the decentralized public investment expenditures that were executed through the tiers of local government and those that were related with the secondary and tourism sectors asserted a positive and significant impact on regional resilience. These results are signifying the importance of public policy in regional resilience and could be utilized for the formulation of regional policy during recessions.