The Price of Berlusconi

Daniel Gros at Vox:

As Italy's debt crisis enters the danger zone the question arises: Can Italy ever overcome its decade-old growth slump? This column shows that Italy's growth fundamentals are all in pretty good shape, except one - good governance. [The World Bank's] Worldwide Governance Indicators show a dramatic worsening during the Berlusconi governments especially when it comes to the rule of law, government effectiveness, and control of corruption. Progress on improving these might in the end be more important for growth than the reforms the EU demands.

Gros points out that Italy now ranks lower on quality of governance than any other eurozone country, including Greece.