Access to Capital and Finance: An Institutional and Behavioural Analysis of the UK Financial-Governance Set-Up for Economic Development in Economically Weaker Regions – in the Light of International Comparator Evidence
This project examines the contribution state development banks can make for improving access to finance in lagging regions.
About
Successful local and regional economies often benefit from diverse funding portfolios, where multiple sources of financing are used to work collaboratively within integrated development projects to revitalize or strengthen local economies.
These sources of financing include private investment capital for large commercial projects or for dynamic and innovative start-ups; bank capital and personal finance for small and medium sized firms and small projects; corporate businesses such as housing and retail developers, as well as public capital and revenue in the form of grants, loans and taxes.
However, in most countries, significant within-country regional disparities persist in the availability of both private and public investment capital aimed at fostering local economic development. These disparities hinder the effective implementation of economic and social cohesion policies.
National and subnational state development banks have the potential to bridge these gaps by addressing market failures, financing innovation, and mobilizing private investments. Yet, the ways in which these state investment vehicles interpret and execute this role remain insufficiently understood.
Key facts
- Start date: September 2024
- End date: September 2025
- Funding amount and funder: £21,000 The Productivity Institute
Aims
The project seeks to address this gap by analyzing the contributions of three prominent development banks—KfW in Germany, Bpifrance in France, and the European Investment Bank (EIB)—alongside their sub-regional counterparts in advancing regional development across Europe.
The project examines their institutional frameworks, strategic priorities, partnerships, and self-perceptions of their roles in enhancing regional economic resilience, drawing on extensive interviews with key stakeholders and in-depth documentary analysis.
