Challenging Growing Regional Inequality: Area-Based Policies in Germany as a Path to Equivalent Living Standards?

Abstract In recent years, inequality has deepened across many European countries. Targeted investments have seen limited success, and many democracies face growing polarization as disparities along economic, demographic, and social lines persist. In Germany, residents of structurally disadvantaged areas increasingly feel overlooked by policies focused on economic growth rather than everyday needs. This article explores what residents in these regions perceive as lacking in their living environments, what influences their satisfaction or dissatisfaction, and how well current policy, specifically the funding scheme of the Joint Task for the Improvement of Regional Economic Structures (GRW), responds to these concerns. Based on fieldwork in three GRW-eligible communities, the study compares local perceptions with the scheme’s design and recent reforms. While reforms show a shift toward basic infrastructure, important aspects of daily life, such as transport, social spaces, and local retail, remain difficult to support under current funding rules. Civil society actors face limited access to resources, and municipalities often lack the capacity to apply for and implement available funds. These findings point to the need for better alignment between funding mechanisms and the lived realities in disadvantaged regions.