In trying to explain and assess the impact of European policy initiatives on regional policy-making in the member states, the article identifies three dichotomies (or competing functioning logics) that have shaped regional policy-making in Europe. Against the background of these dichotomies, the article addresses three questions that are crucial for analysing regional policy-making in Europe. Are the Structural Funds primarily a compensatory mechanism for imbalances in net-contributions to the EU budget? Has the logic of decision-making in the area of European regional policy moved towards multi-level governance? Are European cohesion objectives undermined by the Commission's activities in the area of state-aid control? Evidence from East Germany's integration into the EC's regional policy regime supports the claim that European regional policy initiatives can constitute a double-edged sword for member states. While member states have been able to reap financial benefits, these benefits have come at a political cost as European regional policy initiatives have curtailed the independence of national authorities
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