The absorption capacity of European funds for rural development in Romania: estimates of the factor influence

Abstract

This paper addresses the absorption capacity of the European funds for rural development in Romania, given their crucial importance for reducing the urban-rural gap and supporting the convergence within the EU structures and living standards. After discussing the problems that agriculture and rural development in Romania are confronted with, an estimation from a regional perspective of the factors that influence the absorption capacity of the EU funds is proposed. This is based on a quantitative analysis which combines three research approaches: multiple regression models, principal component analysis and a new composite index of absorption capacity of European funds for rural development in Romania. The results point to the significant influence of the counties’ characteristics on their capacity to absorb the funds available for agriculture and rural areas development and can offer a useful background for the forecasts on the regional absorption rates in this sector.