The estimate, based on a study by Friedrich Schneider, economics professor at the Johannes Kepler University in Linz, Austria, topped the professor's own estimate of seven years ago, when corruption reached a low-point of €220 billion.
Economists agree that bribery and favours among public officials and private businessmen are generally dependent on the economic situation – the worse the economy, the more open people in authority are to a brown envelope under the table.
But according to a report in Die Welt newspaper, the study concludes that there are other factors at play, including what Schneider calls "increasing bad habits."
The professor thinks there are only two effective ways to prevent corruption – stricter rules and more severe punishments, or better pay. He added that the two needn't be mutually exclusive.
The researcher's conclusions are based on data from the corruption index kept by Transparency International since 1995. Germany ranks 14 in the chart of least corrupt countries.
Economists believe corruption damages the economy because bribery often leads to the best and cheapest offer losing a deal, which leads to smaller investments for these investment projects. This ultimately damages growth.