eflexivity and indigenous growth on the regional level has been further accelerated by the process of the European integration since the mid-1980s. The 1988 reform of the Structural Funds helped the less developed regions of the Community by providing them new stimulus and additional support. While by the Single Act and the 1992 programme regulatory competition for direct investment was increased and incentives for interregional co-operation was provided for the better off regions. The new structural funds aim not only for redistribution of financial resources, but also for a management of regional policy to enable regions themselves to take charge of economic development. This results in a multiplier effect: more European money is aimed at specific areas, but the regions themselves are now spending more money on development. Economic growth is then generated. Some of the leading regions have shown a high annual growth rate and low unemployment with new regional industrial policies, particularly with regard to enterprise support for small and medium sized firms. One of the other advantages of regionalized industrial policy is that they are more sensitised to and sensitive of the needs of regional firms. The money going into a member states region must be additional to the flow of national public spending into the region. The latter argument favours a Europe of regions. Regions try to attract both foreign and domestic investors to speed up the land use and to spur higher education, training and specialization. Labour specialization eliminates the loss of time, which accompanies each shift of a worker from one task to another. Managerial specialization means a better use of large-scale production. It is largely desirable because it results in more efficient production. The underdeveloped areas have a need to improve their comparative advantage versus the industrial areas. This process is done through industrialization. Comparative advant...
