Exchanging money for love? A regional analysis of EU cohesion policy and Euroscepticism

In the past, the European Union was able to tame Euroscepticism through regional ‘convergence’ funding. Meanwhile, new member states became the largest recipients of EU funding, but shifted from being the most supportive of integration to showing the strongest opposition. Motivated by this puzzle, we revisit the relationship between ‘convergence’ funding and Euroscepticism. In contrast to utilitarian economic theory, our empirical analysis finds no general relationship between EU funding and support for the EU. Nevertheless, by accounting for successful post-funding convergence and awareness of EU funding, we identify under which conditions ‘convergence’ funding can tame Euroscepticism. Focusing on successfully converging regions after receiving EU funding, we uncover positive trends in EU unification preferences. Finally, we show that the EU is able to win support in Eastern Europe where people are more aware of EU investments. Rather than expanding its fiscal capacity, Brussels must focus on place-based ‘convergence’ funding that stimulates economic growth and is unambiguously associated with the EU.