A region-level analysis of the long-term economic effects of joining the European Union

In the European political debate, potentially vast economic benefits derived from the European Union are usually taken for granted. In the scholarly discussion, the economic benefits are less consensual and beg for more rigorous analysis. Using synthetic control methodology, we estimate the counterfactual growth scenario in response to joining the EU at the subnational level for the regions and provinces of both founding and non-founding member states, with data for the period 1840-2016. Our results suggest that EU institutional design has disproportionately benefited the economic growth of regions of the founding member states and several more recent entrants such as Austria, Ireland, Poland, and the Czech Republic. For the regions of non-founding member states, predominantly from peripheral Europe, we find either zero economic growth effect or only a weak and temporary effect. Large differences in the significance of the EU-related growth premia are detected across and within the member states.