Permission to bail out EU’s national flag carriers? Technocratic and political determinants of commission approval of state aid to national airlines in difficulties in the pre-COVID era

Abstract

AbstractThe enforcement of EU state aid rules is often portrayed as mainly driven by technocratic standards, but there are indications that political factors also play a role. However, their exact impact and relationship with technocratic factors remain unknown. This article studies under which technocratic and political conditions the Commission approves or does not approve state aid to national airlines. Based on a crisp-set Qualitative Comparative Analysis of all 14 cases of alleged state aid to national airlines between 2004 and 2019, the article shows that both the approval and non-approval of aid are predominantly dependent upon the Commission’s technocratic assessment: a low degree of market distortion turns out to be a sufficient condition for the approval of aid, whereas a high degree of market distortion is a necessary condition for the non-approval of aid. However, in some cases, political factors are decisive in determining enforcement outcomes.