The Cypriot Economic Collapse: More Than a Conventional South European Failure

Abstract:

In trying to assess the causes behind Cyprus's request for a financial bailout, the paper takes a step back and reviews the economy of the island within a comparative political economy framework. With reference made to varieties of capitalism (VoC) literature, the paper sets a twofold target. Initially, by introducing Cyprus into the VoC literature, it attempts to underline the limitations of existing literature in allowing for a smooth categorization of Cyprus under the Mediterranean model of capitalism, and, subsequently, it seeks to explain the economy's near collapse, highlighting that Cyprus is not merely another piece of the sovereign debt crisis mosaic covering the European Southern periphery.