The seminar's point of departure is that interest rate convergence and the elimination of exchange rate risk meant that massive capital inflows softened rather than tightened budget constraints for peripheral countries in the Euroarea.
Governments in these peripheral economies gained some room for budgetary manoeuvre. We argue that this allowed them to not only avoid the path of welfare state retrenchment, but to also increase social spending. In contrast to the literature that has viewed fiscal space as a variable leading to institutional deterioration, we suggest that such increases in fiscal space can also be used to modernise the social spending system and steer it towards a more equitable direction. By focusing on two different peripheral countries, Greece and Ireland, and on spending on old age pensions, we argue that in both cases, government -planned pension reforms in conjunction with the newly created fiscal space allowed governments to implement reforms that reduced poverty and inequality among the elderly.
Angelos Angelou is a PhD candidate in the European Institute. His work focuses on how international bureaucracies address new policy questions during times of crisis. Prior to the PhD, Angelos worked for the Wilfred Martens Centre for European Studies. Angelos holds an MA degree in European Studies and International Economics from the Johns Hopkins University- School of Advanced International Studies. During his postgraduate studies he worked as a research assistant for Professor David P. Calleo.
Chrysoula Papalexatou is the Hellenic Bank Association Postdoctoral Fellow at the Hellenic Observatory. Her research focuses on the political economy of monetary integration and economic inequality. Before joining the LSE's European Institute for her PhD studies, she studied Economics (BSc) and Politics and Economics of South Eastern Europe (Master’s) at the University of Macedonia (Greece). She also worked for two years in the banking sector at the National Bank of Greece.
Professor Kevin Featherstone is Eleftherios Venizelos Professor of Contemporary Greek Studies and Professor of European Politics. He is the Director of the Hellenic Observatory and Co-Chair of LSEE: Research on South-East Europe within the European Institute. He has held visiting positions at the University of Minnesota; New York University; and Harvard University. Before LSE, he held academic posts at the universities of Stirling and Bradford. In 2009-10 he served on an advisory committee to Prime Minister George Papandreou for the reform of the Greek government. He was the first foreign member of the National Council for Research and Technology (ESET) in Greece, serving from 2010-2013. He is Vice-Chair of the Academic Council of 'Atomium Culture', Brussels, a not-for-profit promoting collaboration within the European Research Area. In 2013 he was made ‘Commander: Order of the Phoenix’ by the President of the Hellenic Republic. In 2014, the European Parliament selected one of his books (co-authored with Kenneth Dyson) as one of its ‘100 Books on Europe to Remember’. He has contributed regularly to ‘Kathimerini’.
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Fiscal Space in the Eurozone: redistribution in Greece and Ireland
The Hellenic Observatory (@HO_LSE) is internationally recognised as one of the premier research centres on contemporary Greece and Cyprus. It engages in a range of activities, including developing and supporting academic and policy-related research; organisation of conferences, seminars and workshops; academic exchange through visiting fellowships and internships; as well as teaching at the graduate level through LSE's European Institute.
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