Examining the Role of Fiscal Capacity and Political Tradition in Member-States’ Position on EU Industrial Policy

This thesis explores how fiscal capacity and political tradition influence the industrial policy preferences of EU member states. In the context of recent geopolitical shifts and the relaxation of EU state aid rules, concerns have risen regarding market fragmentation and unequal benefits among member states. By analysing the positions of Germany, France, the Netherlands, and Italy, the study demonstrates that fiscal capacity significantly shapes national stances, often in alignment with material interests. However, it also reveals that political tradition can modulate policy preferences in significant ways, leading to different outcomes for similar material circumstances. Germany and France, with higher fiscal capacities, show policy preferences that reflect their financial strengths, nuanced by their political traditions. Conversely, Italy and the Netherlands, with lower fiscal capacities, exhibit policy preferences driven by fiscal constraints modulated by ideological orientations...Show moreThis thesis explores how fiscal capacity and political tradition influence the industrial policy preferences of EU member states. In the context of recent geopolitical shifts and the relaxation of EU state aid rules, concerns have risen regarding market fragmentation and unequal benefits among member states. By analysing the positions of Germany, France, the Netherlands, and Italy, the study demonstrates that fiscal capacity significantly shapes national stances, often in alignment with material interests. However, it also reveals that political tradition can modulate policy preferences in significant ways, leading to different outcomes for similar material circumstances. Germany and France, with higher fiscal capacities, show policy preferences that reflect their financial strengths, nuanced by their political traditions. Conversely, Italy and the Netherlands, with lower fiscal capacities, exhibit policy preferences driven by fiscal constraints modulated by ideological orientations. The research underscores the interplay between economic realities and political cultures, suggesting that future EU policy debates will be influenced by both fiscal capacity and deeply ingrained political traditions. This nuanced understanding provides insights into the complexity of the dynamics that drive EU industrial policy formulation.Show less

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Examining the Role of Fiscal Capacity and Political Tradition in Member-States’ Position on EU Industrial Policy