Cronyism, Nepotism and familiarism, not only problems in the developing world.

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To help family members find a job, sometimes within the family’s business, has a long tradition. Such nepotism comes, however, not without costs for the society as a whole. Ed Butler from the BBC encountered it in Italy together with some scholarly proof.
The term “nepotism” has its roots in Italy relating back to the practice of Renaissance popes to name a nephew or other relative as their chief minister. Over the centuries the practice has spread over countries and professions, but never left Italy. Recently a research group headed by Professor Perotti from the Bocconi University in Milan analyzed the concentration on surnames in the Italian academia and found that some Universities are dominated by families handing out education, titles and positions to their members. Such “familiarism” extends to big companies which often base hiring often on the personal introduction of candidates and occasionally engage in agreements with labor unions to offer preferential treatment for one family member if another retires early. Such practices are, of course, regarded as unfair by those less well connected and seen as a sign of a corrupt social culture in general.
Family help in private businesses is one thing, and there is an old tradition in many countries that sons step into the footprints of their fathers when it comes to the employer. The establishment of nepotism in public institutions or big companies is, however, another matter and companies today are well advised to award positions on merits and not on “connections”. Family businesses regularly suffer in the long run if family ties are more important than qualifications. Societies suffer when young people get the impression that educational efforts and professional achievements don’t get rewarded.