IDEAS home Printed from https://ideas.repec.org/p/pav/demwpp/demwp0001.html
   My bibliography  Save this paper

State Aid to Business in the European Union: a Focus on the Car Sector

Author

Listed:
  • Marcella Nicolini

    (Department of Economics and Management, University of Pavia)

  • Carlo Scarpa

    (Department of Economics, University of Brescia)

  • Paola Valbonesi

    (Department of Economics, University of Padova)

Abstract

Making use of an original dataset we empirically investigate the determinants of state aid to the car industry in the European Union. The EU regulatory system on state aids and the long history of governments' grants to this industry make this an interesting case study. Our findings show that in the period 1992-2008 -controlling for a number of variables - subsidies to the car sector have shown a decreasing trend, mainly because of the reduction in the aid aimed at increasing the productive capacity of firms. We find a pattern of a dynamic strategic game among EU countries, whereby aiding a firm induces other member states to grant more subsidies; this seems to be mainly driven by rescue and resctruring aid. Overall, economic and political variables (industry's value added, country's income per capita, election year, government's political orientation) are found to significantly affect aid to the car industry.

Suggested Citation

  • Marcella Nicolini & Carlo Scarpa & Paola Valbonesi, 2012. "State Aid to Business in the European Union: a Focus on the Car Sector," DEM Working Papers Series 001, University of Pavia, Department of Economics and Management.
  • Handle: RePEc:pav:demwpp:demwp0001
    as

    Download full text from publisher

    File URL: http://dem-web.unipv.it/web/docs/dipeco/quad/ps/RePEc/pav/demwpp/DEMWP0001.pdf
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Marcella Nicolini & Carlo Scarpa & Paola Valbonesi, 2013. "Aiding Car Producers in the EU: Money in Search of a Strategy," Journal of Industry, Competition and Trade, Springer, vol. 13(1), pages 67-87, March.
    2. Constanza Blanco Barón, 2019. "Discusiones contemporáneas del derecho económico. Serie de derecho Económico n.° 4," Books, Universidad Externado de Colombia, Facultad de Derecho, number 1117.

    More about this item

    Keywords

    car industry; state aid to business; EU competition policy;
    All these keywords.

    JEL classification:

    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • L62 - Industrial Organization - - Industry Studies: Manufacturing - - - Automobiles; Other Transportation Equipment; Related Parts and Equipment
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pav:demwpp:demwp0001. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Alice Albonico (email available below). General contact details of provider: https://edirc.repec.org/data/dppavit.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.