Graft Damages Growth in Austria

Corruption is inflicting growing losses on the Austrian economy, according a new study by the University of Linz.

Bribery and nepotism are set to reduce GDP growth by €27 billion this year, compared to €26 billion in 2011, and €25 billion in 2010, writes Friedrich Schneider, the author of the study.

Corrupt business practices hamper economic growth by lowering productivity, notably by rewarding inefficient firms, damaging morale, and alienating highly qualified workers.

Austria’s position on the Corruption Perception Index, a global ranking by the watchdog Transparency International, has slid from 15th place in 2010 to 16th in 2011.