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Staff Research Projects

The core and associated staff of the Hellenic Observatory engage in a number of in-house, collaborative and commissioned projects along the thematic lines and geographic focus defined by our strategic aims and mission. At the same time, it has also engaged in a number of projects conducted by external researchers to promote public policy research and to foster academic collaboration and networks.

List of Current Research Projects

In search of the optimal fiscal policy mix and what can be learned from the recent history of austerity programs in Greece

 

Dr. Platon Monokroussos with his research entitled “In search of the optimal fiscal policy mix and what can be learned from the recent history of severe austerity programs” is proposed aims to produce 1-2 publishable papers on a number of topics and themes relevant to the below items. 

- An updated assessment of the fiscal consolidation programs implemented in Greece over the last 5 years as well as the outlook going forward, in view of the conditionality underlying the new bailout program, the prospect of new debt relief and current expectations about the evolution of the domestic economy in the years to come.

- Based on the above analysis, the study will derive a number of policy-related implications, so as to judge the degree of success of recent fiscal policies implemented in Greece in restoring fiscal sustainability. Such an assessment would be of significant importance in the current trajectory, especially taking into consideration that Greece’s new (3rd) bailout program contains a new sizeable package of fiscal measures, primarily consisting of VAT rate hikes and new pension cuts. Although the country’s burgeoning public debt burden undoubtedly argues in favor of continuing fiscal prudence (and the provision of further generous debt relief from the official creditors), serious doubts exist about the potential effectiveness (and social fairness) of the new fiscal austerity program. This is especially in view of the domestic recessionary environment and the fact that a poor track record in fighting tax evasion increases the chances that the main brunt of the new measures will again be borne by wage earners, pensioners and other sensitive social groups. Probably, the best way to advance the aforementioned arguments is to let numbers talk: according to the latest data from the Secretariat General for Public  Revenues, cumulative tax arrears in Greece totaled €80 (or c. 45% of 2014 GDP) in September 2015, with as much as €5.6bn of which being accumulated in the first nine months of this year. In view of the aforementioned, the study will make a number of proposals as regards the main characteristics of a more fair and efficient fiscal policy mix that would aim to facilitate the attainability of the agreed fiscal targets with the least possible macroeconomic and social costs. In these lines, and taking into account Greece’s idiosyncratic characteristics, the study will assess the potential implications of a generalized reduction in income tax rates for businesses (in tandem with measures to strengthen VAT and income tax compliance) and will provide some preliminary thoughts on the potential merits and drawbacks of a flat income tax rate. More  generally, the study will make a number of reform proposals that would aim to simplify the tax system, increase its social fairness and efficiency and make it more conducive to attracting increased volumes of foreign direct investment.

 

Non-performing loans in Greece: explaining the interplay of macroeconomic,bank-specific and firm-level determinants

 

Dr. Platon Monokroussos’s research concentrates on ‘Non-performing loans in Greece: explaining the interplay of macroeconomic, bank-specific and firm level determinants’. Dr. Monokroussos examines the determinants of credit risk in the years leading to the global financial crisis and afterwards. In line with a couple of earlier empirical works on the drivers of non-performing loans in Greece (Louzis et al., 2012; Monokroussos and Thomakos, 2014), the study will use an extended set of potential macroeconomic and bank-specific explanatory variables to  empirically test a range of relevant hypotheses proposed by the literature. With regards to macro (systematic) determinants of non-performing loans, the study will examine whether a fully-updated series of potential macroeconomic drivers including real GDP, unemployment rate, inflation, real loan interest rates and real collateral values (proxied by property prices) plays indeed a major role in explaining the evolution of problem loans.

 

The future of housing in Greece

 

Dr Philipp Katsinas investigates the impacts of the economic crisis on housing in Greece. Traditionally characterised by high rates of owner-occupation, the absence of social housing and relatively low residential segregation, the Greek housing system has been affected by increased private indebtedness both towards the state (due to the introduction of a new property tax) and to financial institutions (due to non-performing loans) and the opening up of property foreclosures, which had been largely prevented until recently. Further developments have included the growth in short-term rentals and the entry of transnational investors into the housing market. Using a mixed-methods approach, the project addresses housing recommodification and financialisation, focusing on the interaction between state and supranational policies, financial institutions, investors, and local government development strategies, providing insights on finance- and culture-led urban restructuring and its socio-spatial effects from the Greek case.

 

Wages, employment and labour market reforms: Lessons from Greece

 

Dr Ioannis Laliotis is working on a number of research projects of policy relevance and public debate. His research portfolio spans over empirical applications on the Greek labour market and on the interplay between economic conditions, labour markets and health. As a Research Officer at the Hellenic Observatory of the London School of Economics he is focusing on analysing the impacts from the implementation of labour market and collective bargaining system reforms. More specifically, his research explores the features of the decentralized collective negotiations system in Greece before and after the 2011 industrial relations reform. Using the universe of signed firm-level contracts for a large number of years, his research will attempt to explore the profile of firms that responded to the institutional change and estimate the implications for contractual base wages and other labour market outcomes. Second, and from a more policy-relevant and causal perspective, his research seeks to formally evaluate the impact of the reform, in terms of wages and employment, by developing and matching unique sources of contract and firm-specific data and applying quasi-experimental methods.

 

The Oxford Handbook on Greek Politics

 

Professor Kevin Featherstome is co-editing the volume The Oxford Handbook on Greek Politics with Dimitris Sotiropoulos (Athens). This is due for publication in 2019. It will contain over 40 full-length chapters by leading academics reflecting on post-1974 developments in Greece, placed in a conceptual and comparative perspective. It aims to provide an authoritative guide to the development of contemporary Greek politics – particularly from 1974 to the present, what has been termed the ‘Metapolitefsi’ period since the fall of the Colonels’ junta. This is not a chronological history; rather, it is a reflective commentary and analysis across the key themes of development that have shaped politics, institutions, and policies. As reflective essays, they critically assess the existing literature in specific fields and outline agendas for future research to build-up knowledge and awareness – they identify themes and seek to shape research terrains. Analytically, they comprise conceptual and empirical dimensions to deepen the appreciation of developments and to connect them to a wider, international literature. In placing developments in this reflective and analytical context, the chapters will provide expert insight that can stand the test of time as a key point of reference.


Does the ‘Quality of Government’ matter? Weak states, strong societies, and the challenges of EU governance

 

In the multi-level governance of the European Union, national governments are obliged to carry out a range of functional tasks consequent on their EU membership. This paper by Professor Kevin Featherston assesses how far their performance is affected by their national ‘state tradition’, as developed by Dyson. To operationalise the concept, it distinguishes two key dimensions: administrative tradition and the social autonomy of the state. It applies established typologies of the former and, following Rothstein, it creates an ‘impartiality index’ for the latter. EU member states display variation on both measures. The results show an incomplete pattern in terms of administrative tradition, but significant explanatory value for the independence of state institutions from societal pressures, such as corruption, favouritism, and mistrust. The implications for the EU’s dependency on member state delivery, and its management of their heterogeneity, are discussed in the context of the political sensitivities of recent crises.

 The Greek labour market

 

 Research in this field involves a number of small projects led by Dr Vassilis Monastiriotis, using data from the Greek Labour Force Survey and applied microeconometric techniques to understand various aspects of the Greek labour market and of changes instigated with the crisis and recent labour market reforms. Specific topics include changes in the structure of sectoral returns and of gender-based occupational segregation (both with Rebekka Christopoulou), geographical differences in unemployment adjustments (with Angelo Martelli), changes in intra-household labour supply decisions (with Nikole Lampropoulou) and two research pieces seeking to evaluate in particular the effects of changes in wage-setting on wage adjustability (with Eleni Kyrkopoulou) and of the minimum wage on employment (with Andreas Georgiades and Ioannis Kaplanis). 

 Regional growth and convergence

 

A number of research papers are developed under this theme, concerning both broad economic geography questions and questions linked specifically to the effectiveness of European Cohesion Policy in Greece. A paper on Spatial Structure and Spatial Dynamics of Regional Incomes in Greece (with Can Karahasan) has recently been published as chapter 15 in the edited volume by Bournakis et al (eds), Political Economy Perspectives on the Greek Crisis (Palgrave Macmillan); while a follow-up paper on the theme, titled Regional Inequalities in Greece: A Spatiotemporal Analysis, is currently in preparation (again, with Can Karahasan). Another paper, with Theodore Arvanitopoulos and Theodore Panagiotidis, looks at the patterns of stochastic convergence across the Greek prefectures and examines their geographical-economic determinants. Last, the Spatial Allocation and Economic Impacts of Cohesion Funds in Greece is examined in current work in collaboration with Dimitris Kallioras and George Petrakos.

The quality of Competition Law enforcement: the case of Greece

 

Professor Yannis Katsoulacos research focuses on ‘The Quality of Competition Law Enforcement: the Case of Greece’. The main objective is to identify the quality of competition law enforcement in Greece focusing on the question of whether suitable legal standards are adopted in the assessment of potentially anti-competitive business conduct by the Hellenic Competition Commission (HCC). Effective competition is one of the main pillars of a strong and prosperous economy and the effective enforcement of Competition Policy by Competition Authorities (CAs) is one of the main pillars for establishing effective competition in a modern economy. The main objective is to test empirically for the first time the choice of legal standards by the HCC, after constructing a unique dataset of decisions made by the HCC between 1996 – 2017; this will allow inferences about the quality of enforcement of the HCC; inferences concerning the predictions of recent theoretical models concerning the choice of legal standards by utility maximising CAs; also it will allow us to undertake international comparative analysis utilising other countries’ datasets, that are available to the project proposer and to investigate and make policy recommendations regarding the design of alternative, welfare improving, enforcement procedures and structures. 

 

Sectoral Dynamics in the Greek Crisis

 

Professor Nicos Christodoulakis is investigating how Greek firms behaved in the context of the recent financial crisis, regarding patterns of growth, capital allocation and the ability to survive the fall in aggregate demand. Research is carried out both at an aggregate level and across sectors and regions, so as to draw conclusions regarding possible directions for business activity in the future. The aim of the research is to develop appropriate models and produce evidence regarding: (i)The effect of firms’ size in their ability to grow in the market and survive the economic crisis. (ii) The effect that sectors and regions might have on the resurgence of business activity in Greece. (iii) Suggestions on the type, structure and allocation of business activity, as well as the kind of market reforms that might accelerate economic growth in Greece in the following years.

 

 

Past Research Projects

Over the years the Hellenic Observatory has produced high-quality, multi-disciplinary research.

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