Skip to content

The Interference of Law and Economics: The Case of Guarantees for Bank Debt and Their Impact on the Competitiveness of the EU Member States

Piotr Podsiadło

State aid to companies is a highly sensitive economic and legal issue that strongly impacts on the functioning of the European Union as an integrating economic system. The special importance of State aid arises from the fact that the EU economy is based on the market mechanism and competition. However, State aid to companies breaches – to a greater or lesser degree – the principle of fair competition. For these reasons, State aid is strictly regulated in EU and national legislation. The issue of State aid was a particularly important challenge for many EU countries and for the EU itself during the financial crisis, when many companies and financial institutions were threatened with bankruptcy, which could have deepened the economic crisis. The article presents a review of rules applicable to the State aid for financial institutions during the crisis, especially in form of guarantees for bank debt. The qualitative analysis of State aid granted by the Member States was carried out under the provisions of the Treaty on the functioning of the European Union and the European Commission guidelines on the development and implementation of State aid for banks. Statistical analysis was carried out based on the linear regression model. The response variable (dependent variable Y) was the GDP per capita, and explanatory variable (independent variable X) was the expenditure on guarantees for bank debt.
Keywords: State Aid; Financial Crisis; Guarantees; Bank Debt; European Union; Competitiveness; Linear Regression Model.

Dr Piotr Podsiadło - Assistant Professor at Cracow University of Economics, Poland; Chair of Local Government Finance, Faculty of Finance, Cracow University of Economics []. Member of The Risk Banking and Finance Society in Florence, Italy. The publication was financed from means granted to the Faculty of Finance of Cracow University of Economics, within the subsidy framework maintaining the research capacity.


Lx-Number Search

(e.g. A | 000123 | 01)

Export Citation