State capacity and ‘embeddedness’ in the context of the European Union’s Regional Policy: the case of Greece and the third Community Support Framework (CSF)

Abstract

This paper aims to explain the weak developmental impact that the third Community Support Framework (CSF) funding had for Greece by adopting a conceptual framework based on the theories of internal and interactive state capacities. It postulates that a series of characteristics of the domestic political economy – clientelism, corruption and low levels of social capital – did not allow the third CSF to substantially alter the endogenous capabilities of the Greek economy. Most of the Operational Programmes (OPs) faced significant delays whilst the strengthening of the monitoring procedures attempted by the Commission – exemplified through the ‘n+2’ rule – only served to exacerbate the situation. The reinforcement of the domestic administrative and territorial reforms that will improve the capacities of the Greek state is suggested as a possible way forward.