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The Greek crisis is a crisis of production, not of public finance

Lyberaki, Antigone, (2016), “The Greek crisis is a crisis of production, not of public finance”, LSE Blog, 16 Σεπτεμβρίου

The Greek economic crisis is a crisis of production. Its key actor is a unique feature of the economy, the Greek family firm. Seen through that prism, the crisis is simply another episode in the story of how small firms tried to fit into the world economy as that was becoming increasingly globalized. ‘Putting a face in impersonal developments’ provides the economic and sociopolitical context in which the macroeconomics and fiscal developments operate. It unifies the course of economic history from the 1960s and, in this way, poses questions usually ignored: How did the Greek economy turn from the successful EC applicant and convergence poster child of the 1960s and 1990s into the Eurozone basket case of the 2010 crisis? Why was a coping strategy which had proved successful in the past fail the country after 2010? Answering the question ‘why is Greece different?’ provides historical continuity. More importantly though, it allows us to approach the question of ‘how can Greece finally exit the crisis’?

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