1. SWEDISH AGENCY FOR ECONOMIC AND REGIONAL GROWTH 1 Knowledge formation for structural change, innovation and growth – a challenge for Evaluation! 2011-10-11 Göran Brulin

2. SWEDISH AGENCY FOR ECONOMIC AND REGIONAL GROWTH 22 Both the former and the present government have been critical to the structural funds: The prime minister and EU minister in Sweden is arguing that Sweden is the third heaviest net contributor after Germany and the Netherlands! The net contribution to EU:s budget is 1,1 billion Euros. According to the both ministers ”neither Sweden nor the other 26 member states benefit from the structural funds in relation to their costs”. They want to see the structural funds (and the rural fund!) replaced by programmes that really support research, innovation and growth!

3. SWEDISH AGENCY FOR ECONOMIC AND REGIONAL GROWTH 33 Why isn’t the implementation of the structural funds convincing? Although it could be argued that structural funds are playing an important role in experimentation and learning for structural change, innovation and competence development in Sweden much more has to be done to convince! Especially in the present crisis the Swedish implementation could be viewed as the seeds for future structural policy in EU, a policy that, according to many experts, is urgently needed to complete the financial support to member states. There have, however, been severe problems in the systems for follow up, indicators and evaluation approach!

4. SWEDISH AGENCY FOR ECONOMIC AND REGIONAL GROWTH 44 Problems in the systems for follow up (Tarschy, frustrated expert to Commission): Reliability, how are e.g. NEW JOBS measured? Validity, what figures are used for reporting e.g. NEW FIRMS, INNOVATIONS, etc. Deadweight, why are not the alternative use of these resources discussed? Logical errors, the systems do not support the overall objectives of the structural funds and national programmes! (Tarschy, Daniel. 2011. How Small are the Regional Gaps? How Small is the Impact of Cohesion Policy? A Commentary on the Fifth Report on Cohesion Policy. European Policy Analysis, issue 2011:1epa.)

5. SWEDISH AGENCY FOR ECONOMIC AND REGIONAL GROWTH 55 An illustrative example of the problems in the indicator systems: The projet FindIT illustrates the problems. The overall goal is to contribute to competiveness within the region through smarter and more efficient business system solutions. I.e. the number of employees working with business system solutions have to be reduced whereas the competence of the employees has to be increased. I.e. the 170 companies working with business system solutions in the region need to be reduced by half and significantly upgraded in order to collaborate with international suppliers such as SAP. In other words, FindIT to reach success actively has to WORSEN the core indicators – NEW JOBS AND NEW FIRMS!

6. SWEDISH AGENCY FOR ECONOMIC AND REGIONAL GROWTH 66 There are problems in the evaluation approaches applied: The three C:s approach – Control group/experiments, Counterfactual and Cost Benefit Analyzes – does not convince about the merits of the structural funds. Also the Commission acknowledges that a more efficient implementation needs smart specialization; fewer projects of similar kind in different program areas; more co-operation between projects; connections between the structural fund programs and the research programmes and so on.

7. SWEDISH AGENCY FOR ECONOMIC AND REGIONAL GROWTH There is a quest for a paradigmatic change in knowledge formation and evaluation: -The former chairman of US Evaluation Society argue in Developmental Evaluation. Applying Complexity concepts to Enhance Innovation and Use. that what is needed is knowledge formation through evaluation that supports change and development! -Developmental evaluation includes an on-going and learning approach; a system perspective with dynamic relationships between different actors; a rapid response to changes made; working with emerging ideas; trying to find general principles and adapting them to new contexts. -Our contribution to this quest is the book: Managing Sustainable Development Programmes. A Learning Approach to Change (to be published by Gower 2012).