Abstract
As the budgets of the European Union (EU) become tighter, the questions about the effectiveness of EU’s expenditure, especially the most important parts such as Cohesion policy, are hotly debated. The aim of this paper is to examine whether the presence of social attitudes may influence the effectiveness of EU budget expenditure, measured by the level of regional inequalities. The analysis starts by focusing on individuals’ attitudes towards income from their own effort and income which is derived from other people’s effort, having in mind that individual actions depend on their attitudes. The next step establishes the link between the income from other people’s effort with the re-distributive dimension of the EU budget, considering that different attitudes among individuals in the EU could lead to significant differences in effectiveness of this redistributive policy among European regions and, consequently, diverse regional inequalities. Empirical research uses data for 27 EU countries observed over two waves of European Value Surveys: 1999-2000 (Wave 1) and 2008–2009 (Wave 2). The results indicate a significant role of social attitudes for regional inequalities, which raises the question of the appropriateness of simplification and uniform regional policy instruments in solving EU regional problems.
Highlights
During economic and political integration in the EU, various steps led to the successive inclusion of more nations which have increased regional disparities within the EU
Actors that are only interested in their own payoffs prefer “unearned” income because it implies the benefit without the cost
Actors motivated by the payoffs of others are in position of balance between “benefit without cost” (“unearned” income) and utility derived from the payoffs of actors that provide “unearned” income
Summary
During economic and political integration in the EU, various steps led to the successive inclusion of more nations which have increased regional disparities within the EU. The importance of the regional inequalities does not have only ethic and social dimensions and an economic growth dimension. Its main purpose is to promote the “overall harmonious development” of the EU, to reduce disparities between the levels of development of the various regions, and to strengthen its “economic, social and territorial Cohesion” (Art. 158 Treaty on European Union). During the years the budget has been increased significantly, from 5 % of the total Community budget for period 1975 – 1978 up to 35.7% for the current 2007-2013 programming period (Manzella and Mendez, 2009) indicating the raising importance of the regional inequalities issue
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