Current state of knowledge
Russia’s aggression in Ukraine, in addition to the drama of the war and its effects on the Ukrainian people, has exacerbated pre-existing concerns about the threat to humanity posed by the unresolved negative consequences of the COVID-19 pandemic, the increasingly likely climate crisis, and increasing economic pressures related to rising prices and uncontrolled inflation (World Bank, 2022b). The identified consequences of this subsequent development shock are distributed unevenly in space, which once again indicates the importance of regional policy in effectively overcoming barriers resulting from deepening development differences. Under these conditions, the most effective approach to its implementation is the territorial orientation of regional policy (place-based policy), which is currently the mainstream of programmed and implemented intervention activities. It is based on the assumptions of Fabrizio Barci’s regional policy reform (2009), promoted, among others, by thorough recommendations contained in OECD reports (How regions…, 2009; Regions Matter…, 2009). In this trend, it is emphasized that effective regional policy requires targeted interventions addressed to territories identified in terms of their diversity (Churski et al., 2020b).
Explaining the regularities of the regional development process and the evolution of regional policy in conditions of development shocks is based on the theoretical achievements of evolutionary economics and evolutionary economic geography. Theories of economic evolution meet three basic conditions (Boschma, Martin, 2010). First, they are dynamic. Secondly, they concern irreversible processes; the past cannot be recovered, but it conveys a legacy that determines the behavior of economic factors now and in the future. Third, theories of economic evolution must include the creation and impact of novelty as the primary source of self-transformation. Against this background, evolutionary economic geography deals with the processes by which the spatial organization of economic production, circulation, exchange, distribution and consumption undergoes transformations over time. As R. Boschma and R. Martin (2007) put it, economic geography deals with the spatial aspects of economic novelties (innovation, new firms, new industries, new networks), how the spatial structures of the economy appear as a result of economic microbehaviors of representatives (individuals, companies, organizations); how, in the absence of central coordination or direction, the economic landscape is self-organizing; how path-making and path-dependence processes interact in shaping the geography of economic development and transition, and why and how such processes may themselves be site-dependent.
In the search for understanding the processes and mechanisms of spatially differentiated reactions of territories to the impact of development shocks and the resulting consequences for their development, the concept of resilience is applied (Cox, 2019; Drobniak, 2018; Jania, 2021; Masik, 2022; Rouet, Pascariu, 2019). The origins of this concept should be sought in ecology, psychology, medicine and research on the effects of disasters (Gong, Hasink, 2016). This concept is defined in various ways on the basis of evolutionary economic geography. Its root is derived from the Latin term resilio, which can be translated as “leap back” or “rebound” (Simmie, Martin, 2010). However, there are different wordings in the sample definitions. In the Oxford Handbook of Economic Geography, the concept of resilience is narrowly defined as the capacity of a system to absorb disturbances without significant changes in its functioning, which may lead to its transition to a new stage of development (Clark et al., 2000). However, the literature on the subject uses a very wide catalog of terms: “fighting off disturbances” (Ferreira et al., 2016: 291), “absorbing pressure” (Lhomme et al., 2013: 222), “returning to the state before the disturbance” (Hill et al., 2011: 1), “going beyond just rebuilding” (Campanella, 2006: 142), “rebounding, recovering” (Davoudi, 2012: 301–302), and “preventing disruption” (Moraci et al., 2018 : 11). As rightly noted by Drobniak et al. (2021), in recent decades, a certain methodological order has emerged that allows for the systematization of the ways of understanding the concept of resilience in the system of four basic meanings (Martin et al., 2016; Martin, Gradnier, 2019; Martin, Sunley, 2020): resilience as the ability to bounce back, rebuild after a shock or disorder (bounce back, recovery):
- Resilience as the ability to absorb shock effects and disturbances (resistance, ability to absorb),
- Resilience as the ability to adapt in anticipation or reaction to shock or disorder (bounce forward, adaptive resilience, partial/selective adaptability),
- Resilience as the ability to transform in anticipation or response to shock or reconfiguration.
The latest development shock, which fundamentally changed the development situation of regions in the world, includes the economic and social consequences of Russia’s aggression against Ukraine. The war led to fundamental changes in the functioning of the socio-economic system and resulted in many consequences (Grum, Kobal Grum, 2023). The reaction to these consequences is diverse, as are the resources, opportunities and development barriers of individual territories. This applies both to regions within Ukraine (Mitoulis et al., 2023; Romanova, 2022; Melnykovska, 2023) and regions located in other countries of the world (Wick, Ayrinhac, 2022). Their reaction and, consequently, changes in their development process, as well as adaptation to the new conditions of regional policy intervention, can be considered from various perspectives. They are related to the possibility of perceiving the resilience of territories in the conditions of this development shock in four terms, i.e. as: recovery, resistance, partial adaptability or reorientation and reconfiguration.
Previous research on regional resilience in the context of the social and economic consequences of Russia’s aggression against Ukraine has mainly focused on areas of Ukraine (Romanova, 2022; Mitoulis et al., 2023; Melnykovska, 2023). Research covering EU countries and regions is still very limited, and this project can be an important extension of this research. For example, Anghel and Jones (2022) try to verify the statement attributed to Jean Monnet that “Europe will be forged in crisis” by analyzing the development of the concepts of agency, solidarity and resilience of the EU as a political system during the pandemic COVID-19 and Russia’s invasion of Ukraine. Celi et al. (2022) discuss the variation in vulnerability to a war crisis between EU countries. They note that the “German industrial core” of Europe (Germany and the countries of Central and Eastern Europe) – so far resistant to crises (financial and COVID-related), currently, due to the large role of energy-intensive industry, energy dependence and high exposure to inflation – is relatively very sensitive to the crisis. The authors point to three determinants of vulnerability to the current crisis: dependence on energy-intensive industry, dependence on Russian energy and exposure to broken supply chains. Wick and Ayrinhac (2022) analyze the potential effects of the war on various companies in Germany, noting, among others, development opportunities for the armaments industry. They point to the need to rethink supply chains, prompted by recent crises. The views presented in this article argue against the popular proposals of “reshoring”, which can harm the dynamics of innovation and increase costs. The recommended solution in the new conditions is cooperation within clusters (Simmons, Culkin, 2022).
Justification for undertaking the research problem
The long-term consequences of the war in Ukraine will depend on current political responses. Macroeconomic effects, manifested in changes in the commodity market and in increasing inflationary pressure, may plunge global economies into recession (Izzeldin et.al, 2023). In order to stop negative changes, decisions are necessary; both those taken at the international level and those related to programming and implementation of regional policy interventions, which should be adapted to the specific and spatially diverse regional and local context, drawing on previous experience (Position Statements …, 2020). This requires in-depth recognition of the changing development conditions at the regional and local level and appropriate addressing of regional policy interventions to these changes (Cohesion in Europe towards 2050…, 2022). The consequences of the shock caused by Russia’s aggression against Ukraine cover many spheres, with the following sectors being considered the most important areas of necessary interventions: energy, agri-food, financial and refugee policy (Orha, 2022). They result in changes in the size and structure of economic exchange, changes in prices and the economic calculation, lead to the reconfiguration of value chains, changes in the situation of the labor market and the real estate market, and basically determine the state and structure of public finances, which is confirmed by the changes taking place in the Polish economy and the situation of regions (Dębkowska et al., 2022; Gorynia, Trąpczyński, 2022; Personnel Service, 2023).
The war has shown how important it is to minimize dependence on Russia for key energy imports (Mbah, Wasum, 2022). In the short term, many governments have had to mitigate the effects of higher energy prices, diversify their energy sources and, where possible, make them more efficient (often by shifting to carbon-intensive energy sources) (Khudaykulov et al., 2022). The answer to the growing challenges related to energy security must be, on the one hand, redefining the energy policies of states, and, on the other hand, taking effective measures on a regional and local scale to ensure the improvement of energy efficiency and the implementation of the green transformation in a way supported by society (Karkowska, Urjasz, 2023). To ensure the effectiveness of the energy transition, it should be fully taken into account in regional policy interventions, adapting to the specific resources of individual territories (Chepeliev et al., 2023).
The global food security crisis triggered by the war required immediate responses to provide short-term relief. At the moment, it is known that they did not bring only the expected positive changes; the observed decisions resulted mainly in limiting exports, which additionally intensified the difficult situation (Abay et. al., 2023). In the long term, greater involvement of the international community and, above all, political decision makers, is required to avoid future crises. It is essential to develop policies, implement practices and technologies, and build partnerships that will make food systems more resilient (Hassen & El Bilali, 2022; Behnassi, 2022). However, it should be remembered that, in parallel with actions taken at the global and national level, one should not forget about the necessary support for actions under regional policy. In this regard, it is necessary to provide support to local farmers, both financially compensating for the effects of changes on the food market resulting from the liberalization of customs restrictions, but also technologically improving the efficiency of agricultural production (Kah et al., 2020).
The rising costs of energy and the cost of raising capital observed since the outbreak of the war clearly reduce global GDP growth. However, well-designed and well-targeted financial support can limit the negative impact on growth by adding a relatively small boost to inflation. Urgent and effective global policy action is therefore needed to reduce the risk of global recession and debt problems (Izzeldin et al., 2023). However, one must not forget about the coordination of fiscal policies, both central ones and those conducted at the national level (BonattiBoanatti & Tamborini 2022) and taking measures to ensure the stability of public finances at the regional and local level, in which, e.g. instruments of regional policy intervention (Jarosz, 2023). Long-term stays of war refugees from Ukraine, in a situation of protracted war and its escalation, generate challenges to which governments and citizens react on an ad hoc basis, but actions for the longer term are also necessary.
The numerous challenges faced by governments of host countries relate primarily to strengthening national social protection systems to protect the most vulnerable, including refugees (Orha, 2022). However, one should also remember the different pressures on local and regional systems of education and social services, which are the consequences of the uneven distribution of refugees, and require actions dedicated to individual territories, in accordance with their needs (Duszczyk, Kaczmarczyk, 2022; Koczan et al., 2021).
Justification for the innovative character of the research
The novel/innovative character of the project is manifested in its three elements: firstly, in the adopted research plan; secondly, in formulating the assumptions and objectives of the study; and thirdly, in the empirical data used and the methods of their analysis.
When constructing the research plan, an incremental approach was used to manage the research project. At each subsequent stage of research, we will use the knowledge developed in the previous stage. At each stage of the project, we will be able to verify the assumptions in order to achieve the best possible research results.
In terms of the assumptions and objectives of the study, the project addresses the current and important in the future issue of the socio-economic consequences of the current crisis caused by Russia’s aggression against Ukraine. One of the objectives of the project is to prepare recommendations for cohesion policy interventions aimed not only at solving current problems, but above all at shaping long-term resilience, limiting the consequences of subsequent crises and using new development opportunities, spatially differentiated in accordance with the assumptions of the territorially oriented regional policy (place- based policy). Thus, the project results can be used operationally in the ongoing discussion on the future of European cohesion policy and the necessary changes that must be introduced, both in terms of its programming and implementation (Cohesion in Europe towards 2050 …, 2022; OECD Economic Outlook …, 2022).
The empirical data and the methods of their analysis are a novelty compared to previous research on similar topics (Anghel, Jones, 2022; Celi et al., 2022; Romanova, 2022; Wick, Ayrinhac, 2022; Mitoulis et al., 2023; Melnykovska, 2023). The novelty will be primarily the use of primary sources of quantitative data: unpublished data from the public administration of the studied regions and data obtained thanks to the cooperation of the project team with ESPON. ESPON, which implements, among others, research in the field of European Shrinking Rural Areas – Challenges, Actions and Perspectives for Territorial Governance (ESPON ESCAPE), Geography of COVID-19 outbreak and first policy answers in European regions and cities and Territorialising Resilience: Transforming Europe for an Age of Crisis – TERRES, Overlapping crises (re)shaping the future of regional labour markets – OVERLAP under the ESPON 2030, has collected and offers publicly available unique data illustrating changes in current trajectories development in Europe at the regional and local level. This data makes it possible to significantly extend and authenticate the amount of quantitative information on the socio-economic situation in relation to the official EUROSTAT data commonly used for these purposes.
Taking these data into account will allow for a deeper understanding of the transmission field of the effects of the crisis caused by Russia’s aggression against Ukraine on individual industries and economic sectors, as well as the income situation of residents, entrepreneurs and local government at the regional and local levels. In addition, the database used in the planned research will be extended by information material collected through field research, including a survey (CATI), in-depth interviews and (IDI). The implementation of these studies in four different countries, in test regions selected in a purposeful way on the basis of the results of the conducted quantitative research, will allow for making unique comparisons that provide the basis for innovative conclusions and formulating innovative recommendations. Among the analytical approaches used, an innovative dimension will be the development and application of a multi-variant approach to research and building the resilience of EU countries and regions to shocks resulting from events such as war and other crises.
The importance of the project results for the development of a scientific field and discipline
The social and economic consequences of Russia’s aggression against Ukraine affect every country and region in the world (Orha, 2022; Izzeldin et al., 2023; Viña, Liu, 2023). However, their scale is particularly severe in Europe, especially in the group of so-called front-line countries directly bordering Ukraine (e.g. Poland and Romania), countries bordering the Russian Federation (e.g. Finland), and countries heavily dependent on trade with Russia (e.g. Germany). However, the scope and nature of these impacts vary spatially in accordance with the regularities of the differentiation of territorial capital resources in individual regions. This requires taking into account the assumptions of a territorially oriented policy in shaping the long-term resilience of individual areas and shaping their ability to use new development conditions. Therefore, monitoring and analysing the directions of the ongoing changes seems necessary for systematizing knowledge about new challenges in shaping integrated development policy. For this reason, addressing the social and economic consequences of Russia’s aggression against Ukraine on the process of regional development as well as programming and implementation of regional policy in Europe is very important and has a special methodological, cognitive and application value.
The methodological value of the proposed research is certainly increased by the development of a new conceptual model for identifying and systematizing spatial differences in the social and economic consequences of Russia’s aggression against Ukraine, based on the theoretical foundations of evolutionary economic geography and the concept of resilience (Boschma, Martin, 2007; 2010; Martin et al., 2016; Martin, Gradnier, 2019; Martin, Sunley, 2020). An important methodological contribution to the development of the discipline is also the proposition of an original approach to modelling spatial differences in selected social and economic consequences of Russia’s aggression against Ukraine in the system of EU member states, different from the approaches used so far (Anghel, Jones, 2022; Celi et al., 2022; Wick, Ayrinhac, 2022; Mitoulis et al., 2023). The formulation of an innovative original concept of modeling the resilience of regions to the social and economic effects of Russia’s aggression against Ukraine and its impact on the shape of international economic cooperation, including the identification of adaptation activities, should also be considered important for the methodological development of the discipline. It should also be emphasized that the verification of the methods used, and their assumed modification, will make it possible to determine their usefulness for conducting analyses and building change scenarios.
The results of the proposed research will provide unique information, significantly strengthening the cognitive value of the discipline in identifying the correctness of spatial differentiation of the most important social and economic consequences of Russia’s aggression against Ukraine in EU countries and regions, and opinions on actions to limit them presented by residents, non-governmental organizations, entrepreneurs, and authorities selected European regions. The use of new knowledge, enhanced by high-quality, unique quantitative and qualitative data on the varying resilience of the regions of the EU Member States to the consequences of the crisis caused by Russia’s aggression against Ukraine, will make it possible to increase the effectiveness of actions by fully exploiting their development potential (Churski et al., 2021; OECD Economic Outlook…, 2022).
The contribution of the research results to the current theoretical and methodological debate on defining a solid interpretative framework for identifying, explaining and programming intervention activities responding to the social and economic consequences of Russia’s aggression against Ukraine will not be insignificant for the process of developing and implementing new solutions in the field of cohesion policy after 2027 year (Cohesion in Europe towards 2050…, 2022; OECD Economic Outlook…, 2022). It is assumed that the research findings made in the theoretical and methodological layer will be reflected in the application layer of the Ministry of Development Funds and Regional Policy, as part of the project activities of the National Center for Research and Development. This will be possible thanks to the involvement of the project manager in the ongoing work of the Think Tank organized by the Minister of Development Funds and Regional Policy in order to develop assumptions for the reform of the cohesion policy in Poland and in the EU after 2027, including defining the main recommendations of the Polish presidency in the EU, planned for the first half of 2025.
