Main Article Content
The objective of the article is to analyse the administrative capacity of the municipalities in Estonia for the management of the EU Structural Funds (SF). I argue that small municipalities in Estonia have not been able to use the EU SF support as effectively as large municipalities because their administrative capacity has been weaker and their co-financing possibilities have not been sufficient. I hypothesise that SF have increased competitiveness of all NUTS 3 regions in Estonia. The theoretical part of the article is based on the issue of the development of small municipalities and literature related to aid allocation and the Europeanisation process. The size of local government is the main analytical dimension in this article. Municipalities with less than 5000 inhabitants are considered small, and those with 5000 or more inhabitants are large municipalities. The article is based on a qualitative research conducted among Estonian municipalities in 2011.