European Redistribution and Euroscepticism

Opposition to the European Union (EU) remains strong in many European regions, despite the EU redistributing large amounts of financial support to these regions. With a volume of more than 500 billion euro for the 2021-2027 funding period the EU’s Cohesion Policy aims at promoting economic development in Europe’s "left-behind regions." Despite a large body of research on whether such place-based financial support may reduce Euroscepticism, evidence on the policy’s effectiveness in this regard is mixed at best. This paper investigates the effects of EU regional funds on citizens’ support for the EU arguing that most existing research is limited by a theoretical and empirical focus on aggregate effects. We hypothesize that EU regional policy is unlikely to counter Euroscepticism in many communities because it is unlikely to economically benefit those citizens who are most likely to oppose the EU. Instead, we expect place-based funding to be biased toward certain skill and occupation groups, thereby primarily benefitting well-educated and well-off segments of society who, on average, hold more favourable views of the EU. Empirically, we measure Euroscepticism at both the individual and the subnational level, using a newly harmonized and geocoded panel of Eurobarometer waves from 1980 to 2017 and local-level election results from 1990 to 2020. For causal identification, we leverage both a discontinuity in funding eligibility across subnational regions and a staggered difference-in-difference design to examine both short-term and long-term effects of EU funds on public opinion and political behaviour. Our analysis focuses on how EU funds affect political attitudes toward the EU and voting behaviour for anti-EU parties across different subgroups of society. With our results, we also shed light on the heterogeneity of electoral reactions to place-based support across socio-economic classes in Europe.