Roberto Bernasconi
- 23 June 2026
- ECONOMIC BULLETIN - BOXEconomic Bulletin Issue 4, 2026Details
- Abstract
- State aid expenditure in the EU has risen in recent years against the background of economic shocks such as the COVID-19 pandemic, Russia’s unjustified war against Ukraine and, most recently, the crisis in the Middle East, as well as a global resurgence of interventionist industrial policy. While traditionally aimed at addressing market failures and achieving policy objectives like regional cohesion and environmental transition, State aid has increasingly shifted towards supporting industrial competitiveness, decarbonisation and strategic resilience. This box provides first evidence of this evolution, while further analysis is warranted on how State aid can effectively support shared EU objectives and new industrial priorities while safeguarding competition within the Single Market and maintaining fiscal sustainability.
- JEL Code
- H25 : Public Economics→Taxation, Subsidies, and Revenue→Business Taxes and Subsidies
H81 : Public Economics→Miscellaneous Issues→Governmental Loans, Loan Guarantees, Credits, Grants, Bailouts
L52 : Industrial Organization→Regulation and Industrial Policy→Industrial Policy, Sectoral Planning Methods
E62 : Macroeconomics and Monetary Economics→Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook→Fiscal Policy
D62 : Microeconomics→Welfare Economics→Externalities
- 14 January 2026
- ECONOMIC BULLETIN - ARTICLEEconomic Bulletin Issue 8, 2025Details
- Abstract
- The European Union (EU) Single Market has significantly enhanced economic welfare, competitiveness and resilience by facilitating the free movement of goods, services, capital and labour. Its achievements notwithstanding, the Single Market still has untapped potential, as persistent structural barriers hinder deeper integration, particularly in the cross-border trade of goods and services. Using a gravity model, this paper quantifies the economic impact of these barriers. The findings reveal that barriers could be reduced by 8 percentage points for goods and 9 percentage points for services if all EU countries were to achieve the same degree of trade integration as the Netherlands, a country estimated to be one of the most integrated EU Member States. In the long term, this would lead to significant welfare, i.e. real income, gains of up to 1.3% and 1.8%, respectively, compared with a baseline of no further integration. Furthermore, simulation results suggest that a modest 2% reduction in Single Market barriers could offset projected GDP losses from higher US tariffs. The study emphasises that these estimates are conservative and that deeper integration, particularly in the services sector, could unlock even greater economic benefits.
- JEL Code
- F13 : International Economics→Trade→Trade Policy, International Trade Organizations
F14 : International Economics→Trade→Empirical Studies of Trade
F15 : International Economics→Trade→Economic Integration
O52 : Economic Development, Technological Change, and Growth→Economywide Country Studies→Europe
F17 : International Economics→Trade→Trade Forecasting and Simulation
E61 : Macroeconomics and Monetary Economics→Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook→Policy Objectives, Policy Designs and Consistency, Policy Coordination