Improving competitiveness to bring down high prices
The important – and long-term – causes of higher prices in Greece under the single currency stem from the poor productivity of its labor force and its concomitant competitive weakness. Over time, as is already happening in parts of Europe, those countries (like Germany) with relatively stronger (more efficient) economies and higher rates of productivity will see their prices decline relative to the weaker and less productive states. All countries face problems of greed and opportunism, but what Greece, its government, its private sector and its media need to pay attention to are improvements (in education, employment, training, finance, regulation, organization, public sector administration and the use of technology) that will improve Greece’s competitive position. Until this is done, higher and higher relative prices will simply become the norm. D.A. STONE, Thessaloniki.
