When Austerity Didn't Work: A Case Study of Greece

Andreas Stamatiadis

Bachelor's thesis

Abstract:

The aim of this thesis is to evaluate the austerity measures implemented by Greece during the Eurozone sovereign debt crisis. After providing information on the structural deficiencies of the Greek economy and how they created the crisis and affect economic growth, this thesis provides academic literature and empirical research on the austerity effects on the Greek economy and the Greek people. Furthermore, it criticizes austerity and the fallacies of the IMF, while also debating the Keynesian and supply-side approaches. The results show that albeit remarkable achievements in fiscal consolidation, austerity caused an ongoing recession, while failing to tackle existing structural problems of the Greek economy and increasing regional inequalities and deterioration of the Greek peoples physical and mental health.

Abstract:

The aim of this thesis is to evaluate the austerity measures implemented by Greece during the Eurozone sovereign debt crisis. After providing information on the structural deficiencies of the Greek economy and how they created the crisis and affect economic growth, this thesis provides academic literature and empirical research on the austerity effects on the Greek economy and the Greek people. Furthermore, it criticizes austerity and the fallacies of the IMF, while also debating the Keynesian and supply-side approaches. The results show that albeit remarkable achievements in fiscal consolidation, austerity caused an ongoing recession, while failing to tackle existing structural problems of the Greek economy and increasing regional inequalities and deterioration of the Greek peoples physical and mental health.

Keywords

Greek crisis, austerity, IMF, fiscal multipliers

Keywords

fiscal multipliers, IMF, Greek crisis, austerity

Language used: English

Date on which the thesis was submitted / produced: 24. 4. 2016

Thesis defence

• Date of defence: 8. 9. 2016
• Supervisor: Helena Chytilová
• Reader: Jaromír Prokop

Vysoká škola ekonomická v Praze

Bachelor programme / field:
Ekonomie a hospodářská správa / Economics