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Economic principles of state aid control

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  • Haucap, Justus
  • Schwalbe, Ulrich

Abstract

This paper summarizes the economic principles of European state aid control. We start with a discussion of the economic justification for state aid control, including the definition of state aid in European law and exceptions to the general ban of state aid. We then explore the motives for granting state aid, ranging from the correction of market failures over political motives to political economy considerations. We then discuss how state aid control fits into the framework of European competition policy before we comment extensively on the more economic approach to state aid control, as implemented by the European Commission, and the state aid action plan. --

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Paper provided by Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE) in its series DICE Discussion Papers with number 17.

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Date of creation: 2011
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Handle: RePEc:zbw:dicedp:17

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  1. David S. Evans & Richard Schmalensee, 2001. "Some Economic Aspects of Antitrust Analysis in Dynamically Competitive Industries," NBER Working Papers 8268, National Bureau of Economic Research, Inc.
  2. Brennan,Geoffrey & Buchanan,James M., 1980. "The Power to Tax," Cambridge Books, Cambridge University Press, number 9780521233293, April.
  3. Shoven,John B. & Whalley,John, 1992. "Applying General Equilibrium," Cambridge Books, Cambridge University Press, number 9780521266550, April.
  4. Parry, Ian & Oates, Wallace, 1998. "Policy Analysis in a Second-Best World," Discussion Papers dp-98-48, Resources For the Future.
  5. Browning, Edgar K., 1997. "A neglected welfare cost of monopoly--and most other product market distortions," Journal of Public Economics, Elsevier, vol. 66(1), pages 127-144, October.
  6. Motta,Massimo, 2004. "Competition Policy," Cambridge Books, Cambridge University Press, number 9780521016919, April.
  7. Schwalbe, Ulrich & Zimmer, Daniel, 2009. "Law and Economics in European Merger Control," OUP Catalogue, Oxford University Press, number 9780199571819, September.
  8. Demsetz, Harold, 1969. "Information and Efficiency: Another Viewpoint," Journal of Law and Economics, University of Chicago Press, vol. 12(1), pages 1-22, April.
  9. Sinn, Hans-Werner, 2002. "Der neue Systemwettbewerb," Munich Reprints in Economics 19830, University of Munich, Department of Economics.
  10. Barros, Pedro P. & Cabral, Luis, 1994. "Merger policy in open economies," European Economic Review, Elsevier, vol. 38(5), pages 1041-1055, May.
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Cited by:
  1. Stühmeier Torben & Wenzel Tobias, 2012. "Regulating Advertising in the Presence of Public Service Broadcasting," Review of Network Economics, De Gruyter, vol. 11(2), pages 1-23, June.
  2. Christin, Clémence, 2011. "Entry deterrence through cooperative R&D over-investment," DICE Discussion Papers 38, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
  3. Haucap, Justus & Herr, Annika & Frank, Björn, 2011. "In vino veritas: Theory and evidence on social drinking," DICE Discussion Papers 37, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
  4. Gu, Yiquan & Wenzel, Tobias, 2012. "Transparency, entry, and productivity," Economics Letters, Elsevier, vol. 115(1), pages 7-10.

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