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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.

Suggested Citation

  • Haucap, Justus & Schwalbe, Ulrich, 2011. "Economic principles of state aid control," DICE Discussion Papers 17, University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
  • Handle: RePEc:zbw:dicedp:17
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    8. Schwalbe, Ulrich & Zimmer, Daniel, 2009. "Law and Economics in European Merger Control," OUP Catalogue, Oxford University Press, number 9780199571819.
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    Cited by:

    1. repec:kap:jincot:v:17:y:2017:i:2:d:10.1007_s10842-016-0230-3 is not listed on IDEAS
    2. Gu, Yiquan & Wenzel, Tobias, 2012. "Transparency, entry, and productivity," Economics Letters, Elsevier, vol. 115(1), pages 7-10.
    3. Haucap, Justus & Herr, Annika & Frank, Björn, 2011. "In vino veritas: Theory and evidence on social drinking," DICE Discussion Papers 37, University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    4. Clémence Christin, 2013. "Entry Deterrence Through Cooperative R&D Over-Investment," Recherches économiques de Louvain, De Boeck Université, vol. 79(2), pages 5-26.
    5. 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.
    6. European Commission, Directorate-General for Competition (Brussels) (ed.), 2016. "Ex-post evaluation of the impact of restructuring aid decisions on the viability of aided (non-financial) firms: Final report," ZEW Expertises, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research, number 130514.

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