Political economy aspects - persistent corruption and a crisis of values

• Author: Andersen, Benny
• Pages: 35-39

T H E C R I S I S I N G R E E C E : M I S S T E P S A N D M I S C A L C U L A T I O N S | 35

The Greek crisis reflected many years of inefficient spending, maladministration, deep-rooted

structural distortions and widespread corruption. These root causes of the crisis were not

sufficiently addressed, even when Greece repeatedly found itself close to an economic abyss.

Since Greece had suffered from particularly weak institutions and political cynicism for years,

trust between the state and its citizens was very weak.

The costs and consequences proved severe. As Nobel Prize winner Paul Romer said, C

and bureaucratic inefficiency act like the worst kind of tax  one that deters economy activity

    ‘  C      

so than in any other EU country (Transparency International, World Bank, European

Commission).

A stunning 98% of Greeks asked told the 2012 EU corruption Eurobarometer survey they

             

institutions. Greeks were the most likely of all Europeans to consider corruption as more

widespread in their country than anywhere else in the EU and felt it had intensified to the point

where it had become a natural part of business culture. And only one in 10 Greeks regarded

corruption prosecutions and punishments as adequate (European Commission, 2012).

T I  C P I   G 

the most, or one o f the most, corrupt EU countries a quarter of a century after joining the EU,

and a decade after becoming a euro area member. Even in the midst of the crisis, Greece slid

several spots down the ranking in 2012 to 94 out of 176 countries listed, compared to its already

relatively weak 2011 position (Figure 4). That was by far the worst performance of any EU

country and nearly 20 positions below Bulgaria, although a change in methodology complicates

the comparison.

T I    G   C     

   G G suffers from abundant corruption mainly in the

               

      T International Greece, 2012).

Figure 4

Corruption Perceptions Index rankings

(1998-2012)

Note: The number of countries included for each year is listed on th e x-axis. Due to a 2012 updat e in the methodology, 2 012 scores are not

comparable with earlier scores.

Source: Transparency International database