Subsidizing European industry: Is Greece the exception?

Contrary to previous estimations of Greece as part of the ‘Southern problem’, the author argues that Greece, in general does not disburse systematically more state aid than the EU-14 average.

Using data from the European Commission during the period 1992–2004 and taking into account the effects of economic globalization, European obligations and domestic institutions, the author finds that in the cases of total and horizontal aid, Greece is not the exception.

However, Greece's comparatively lower level of economic development and the presence of Prime Minister Simitis had a strong negative impact on the less voluminous but still important sectoral and regional aid. The argument has implications for Greek politics and European integration.