From
Claus Hulverscheidt, Berlin
Complain? Negotiate? Or pay back in the same coin? In the dispute over US President Joe Biden’s multi-billion climate protection package, the Ifo Institute has warned the German government and the EU against an overly aggressive response. “A subsidy competition, which is generally about exceeding the funding amounts from other countries in order to protect domestic production, should be viewed critically from an economic point of view,” says an as yet unpublished report by the Munich economic researchers for the Federal Ministry of Finance, which the Süddeutsche Zeitung present. EU state aid could even “lead to welfare losses, for example if inefficient companies remain in the market due to subsidies or align their production to skim off the highest possible subsidy sums”.