This paper studies the effectiveness of different types of cohesion

policies with respect to convergence of regions. A two-region agentbased

macroeconomic model is used to analyze short-, medium- and

long-term effects of policies improving human capital and fostering

adoption of technologies in lagging regions. With fully integrated labor

markets the human capital policy positively affects the economically

stronger region but reduces production in the targeted weaker region.

Subsidies for high technology investment in the weaker region have a

positive local output effect and a negative effect on the neighboring

region, thereby fostering convergence. When labor markets are not

integrated both policies support convergence.