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West German Borderland Aid and European State Aid Control

Author

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  • Eckert Astrid M.

    (Emory University, History Department – 221 Bowden Hall, 561 S. Kilgo Circle, Atlanta, GA 30322, USA)

Abstract

This article focuses on one of the most persistent regional aid programmes in West German history, the so-called “zonal borderland aid” (Zonenrandförderung). The programme supported regions along the 1,393-kilometer long inter-German border that divided West and East Germany during the Cold War. The article seeks to explain the increasingly fraught relationship between borderland aid and European state aid control in the 1970s and 1980s. The intervention of the Directorate for Competition (DG IV) against borderland aid begs an explanation since the Treaty of Rome (1957) had granted a specific exemption for aid to these regions from the competition policies of the Common Market. The article makes the general case that regional state aid is a key component of structural policy alongside sectoral aid. It argues that interest politics prevented a sober needs assessment of the West German border regions, turning Zonenrandförderung into funding by habit, not by need. This left the European Commission as the only institution that could mount a credible challenge to an ossified sense of entitlement in the affected regions.

Suggested Citation

  • Eckert Astrid M., 2017. "West German Borderland Aid and European State Aid Control," Jahrbuch für Wirtschaftsgeschichte / Economic History Yearbook, De Gruyter, vol. 58(1), pages 107-136, May.
    • Handle: RePEc:bpj:jbwige:v:58:y:2017:i:1:p:107-136:n:6
    DOI: 10.1515/jbwg-2017-0006
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    More about this item

    Keywords

    European state aid control; Zonenrandförderung; Gemeinschaftsaufgabe; regional state aid; competition policy; regional aid policy; interest politics;
    All these keywords.

    JEL classification:

    • H - Public Economics
    • H - Public Economics
    • N - Economic History
    • N - Economic History
    • R - Urban, Rural, Regional, Real Estate, and Transportation Economics

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