It’s not about the money. EU funds, local opportunities, and Euroscepticism

• Published in: Regional science and urban economics Vol. 84; p. 103556
• Main Authors: Crescenzi, Riccardo, Di Cataldo, Marco, Giua, Mara
• Format: Journal Article
• Language: English
• Published: Amsterdam Elsevier B.V 01.09.2020; Elsevier Sequoia S.A; The Authors. Published by Elsevier B.V
• Subjects: Brexit; Cohesion policy; Dissent; EU funds; EU membership; Euroscepticism; Labor market; Money; Mutual funds; Referendums; Regression discontinuity; Europe; Brexit; Euroscepticism; Cohesion policy; Regression discontinuity; EU funds
• ISSN: 0166-0462; 1879-2308; 0166-0462
• DOI: 10.1016/j.regsciurbeco.2020.103556

Growing Euroscepticism across the European Union (EU) leaves open questions as to what citizens expect to gain from EU Membership and what influences their dissent for EU integration. This paper looks at the EU Structural Funds, one of the largest and most visible expenditure items in the EU budget, to test their impact on electoral support for the EU. By leveraging the Referendum on Brexit held in the United Kingdom, a spatial RDD analysis offers causal evidence that EU money does not influence citizens’ support for the EU. Conversely, the analysis shows that EU funds mitigate Euroscepticism only where they are coupled with tangible improvements in local labour market conditions, the ultimate objective of this form of EU intervention. Money cannot buy love for the EU, but its capacity to generate new local opportunities certainly can. •We test the impact of European Union (EU) funds on Euroscepticism using a boundary discontinuity design•EU funding has no impact on how British local areas voted at the Referendum on Brexit•Highly-funded areas where local labour market conditions improved are more likely to support EU membership and vote ‘Remain’•EU aid influences voting preferences only if funds promote tangible improvements in local economic opportunities