ABSTRACT
Various theoretical and policy-oriented aspects that affect regional policy, such as the choice of geographical location of domestic and foreign-owned firms, competition and industrial policies, have been encountered in the preceding chapters. The purpose of this chapter is to present the regional policy of the EU in the following way. Section 6.2 spells out basic theoretical issues linked with regional policy. Sections 6.3 and 6.4 consider, respectively, objectives and instruments of a regional policy. Various aspects of regional policy in the EU are the subject matter of section 6.5. It is concluded that the EU should pay attention to regional and cohesion matters for three reasons. First, in an EMU, balance of payments disequilibria are replaced by regional disparities. Second, Eastern enlargement would deepen the regional problem. Third, there is a constant need for the coordination on all levels of government of various policies that have a regional impact.
