The magic recipe

It seems to have become a habit. When chronic structural deficits expose the limitations of Greece’s economic approach, our politicians react by singing the praises of foreign models. So we increasingly hear politicians heaping praise on successful European economies, such those of the Irish, the Danish or Anglo-Saxon, as these are said to combine robust growth with strong social states. It’s not just Greek politicians who are worried. In France, where the economy is mired in high unemployment and low growth rates, the newly appointed prime minister, Dominique de Villepin, recently expressed his admiration for the Danish model. It is said to stand on two pillars: flexibility and security. Italian policy-makers are also in search of the magic recipe since they view Sweden, Denmark and Finland as being in the top five of the world’s most competitive economies. What are the reasons for these states’ prosperity? Is it just circumstantial factors or have their societies perhaps learned to adapt better and faster to the new economic realities? The Swedish model, for example, is renowned for its large public sector, high tax rates that allow the redistribution of wealth, and a generous welfare system. This has not prevented Sweden from achieving high growth rates. Still, studying successful economic models is one thing, but importing a foreign system and adapting it to the cultural particularities of your own country is quite another. Greece was for years hostile to big business enterprises, it did nothing to halt the decline in its tourism and education sectors, and it never stopped massaging the egos of the various union leaders. Implementing the Scandinavian model requires strong political will. Most crucially, perhaps, it requires a mature and determined public.

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