Subventions et politique de concurrence

Legros Patrick

Transfers to firms and regions are made both at the level of member states (state aids) and at the level of the European Commission (Structural Funds). State aids can take different forms: direct (transfers, tax exemptions) or indirect (e.g., the definition of the reserved area in network industries). There are significant cross-country differences both in the magnitude and the type of instruments used for state aids. The European Commission acts as a de-facto regulator by using competition law to approve state aids. We analyze the rationale of this two step process by pointing out the benefits of decentralizing redistributive decisions to the member states and the costs linked to reduced coordination (the use of structural funds, viewed as a complement to state aids, reduces some of these costs). We then point out that in a second best world objectives of redistribution are not incompatible with competition but that their relationship is less straightforward than with perfect markets; this has consequences for the rationale of having block exemptions, and for the effects of structural funds.

Type Article
Identificateur urn:issn:0034-2971
Language fr
Length 11 24
  • Europe as an Area of Economic and Social Regulation
  • Economie
Publication date 2004-01
  • SCOPUS: ar.j
  • Competition law
  • Redistribution
  • Second best
  • State aids
  • Structural funds
ULB Institutional Reference