Are Investments in Basic Infrastructure the Magic Wand to Boost the Local Economy of Rural Communities from Romania?

This article investigates if public investments in rural basic infrastructure represent the best strategy for boosting the local economy of rural communities from Romania. The article focuses on one specific program implemented under the Cohesion policy in the framework of the National Plan for Rural Development called Measure 322. Geographically, the research included a sample of rural communes from the North-Western Region of Romania. Moreover, the study also looks at other determinants of local economic development (LED) than infrastructure investments, with a focus on certain feature characterizing Romanian rural communities such as population size, isolation from urban centers, connection with European and national roads networks, educational stock, etc. The research included three steps, namely the construction of the LED Index, a cvasi-experimental research, and a regression model. Our main findings seem to suggest that while investments in infrastructure help the development gap between beneficiaries and non-beneficiaries remains relatively the same. In terms of determinants of LED, percentage of population with a university degree and connection to a European road are the most significant in the Romanian rural context.