Deliverable 6.2: Detailed Policy Impact Model

Varga, Attila and Jarosi, Péter and Sebestyén, Tamás and Baypinar, Mete Basar (2013) Deliverable 6.2: Detailed Policy Impact Model. Technical Report. tSEARCH FP7 Projekt.

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Abstract

The SEARCH project targets the analysis of the impact of the European Neighborhood Policy (ENP) on the integration of EU neighboring countries with the EU. The research has focused on four areas, such as trade flows, people mobility, human capital, technological activities, innovation diffusion and institutional environment. Work Package 6 is the policy analysis package of SEARCH. This WP synthesizes research results of earlier work packages in order to present an overview of potential EU policy options for strengthening cohesion across the EU-27 and NC16 in the mid to long term. WP 6 employs different research methods ranging from systematic literature analysis via text mining techniques to Delphi methodology and economic modeling. Economic modeling has the advantage that it opens the possibility of ex ante simulating the likely impacts of different kinds of policies. Thus it provides a platform for the comparison of several policy options. This report provides a detailed description of the economic model that has been developed for estimating the likely impacts of certain policy prescriptions arising from research results of earlier work packages. The specific model construct chosen is the GMR (Geographic Macro and Regional) modeling approach that has been applied earlier for Cohesion policy and EU Framework Program impact analyses at the levels of European regions, the European Union and Hungary. The particular country chosen for impact analysis is Turkey. This choice is motivated by practical reasons: availability and reliability of data for modeling. Though data collection for Turkey is not a process without difficulties the situation in this respect is relatively more advantageous there as compared to other ENP countries (with the exception of Israel which cannot be considered as a typical ENP country for other reasons). Turkey is an accession country but in several respects its economic, social and cultural features make this country reasonably comparable to many of the ENP countries. In this report we introduce GMR-Turkey. Its applications in actual policy analyses will be reported in working papers and in another deliveries. This report has the following structure. The second section provides a general overview of GMR-Turkey. Detailed information about modeling structure is given in Section 3. Sensitivity results are reported in Section 4.

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