Quantifying the Effects of Recent Economic and Fiscal Crises on Income Inequality in Greece

George Petrakos (), Konstantinos Rontos (), Chara Vavoura () and Ioannis Vavouras ()
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George Petrakos: Department of Public Administration, Panteion University of Social and Political Sciences
Konstantinos Rontos: Department of Sociology, University of the Aegean
Chara Vavoura: Department of Economics, University of Athens
Ioannis Vavouras: Panteion University of Social and Political Sciences

Chapter Chapter 28 in Advances in Empirical Economic Research, 2023, pp 455-472 from Springer

Abstract: Abstract Income inequality and the effectiveness of policies aiming at its reduction are arguably indicators of a country’s level of economic and social development. In the case of Greece, the lasting economic turmoil and the extensive fiscal interventions facing the nation over the last two decades make it an interesting case to study both the causes of income inequality and the impact of selected policy interventions on income distribution. Three are the main objectives of this paper. First, to identify the main economic and political determinants of income distribution in Greece during the period 1995–2020. Second, to investigate whether the period during which the country was subjected to the Excessive Deficit Procedure of the Stability and Growth Pact, namely the years 2004–2007 and 2009–2017, has significantly affected income distribution in Greece and in which direction. Third, to examine how the period 2011–2016 which we identify as the recent great Greek economic slump, during which very high unemployment rates were associated with negative economic growth rates, has altered income distribution. According to our analysis, the most significant economic factors that affect income distribution in Greece are the share of wages and salaries to GDP, the level of total real GDP, and the rate of unemployment. The subjection of the country to the Excessive Deficit Procedure as well as the period of the great Greek economic slump, exerted a negative impact on income equality, while the years of general elections, as a political determinant of income inequality, seem to improve income equality in the short run.

Keywords: Inequality; Gini coefficient; Income quintile share ratio; Income distribution; Great Greek economic slump; D31; D63; E02 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-3-031-22749-3_28

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DOI: 10.1007/978-3-031-22749-3_28

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