Reforms or Bankruptcy?

Kathimerini, June 26, 2011

3 Pages Posted: 30 Jun 2011

See all articles by Costas Azariadis

Costas Azariadis

Federal Reserve Banks - Federal Reserve Bank of St. Louis

George Constantinides

affiliation not provided to SSRN

Christos Constantatos

University of Macedonia

Harris Dellas

University of Bern - Department of Economics; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Nicholas Economides

New York University - Leonard N. Stern School of Business - Department of Economics

Michael Haliassos

Goethe University Frankfurt - House of Finance; Goethe University Frankfurt - Faculty of Economics and Business Administration; CEPR; NETSPAR

Panos Hatzipanayotou

Athens University of Economics and Business; CESifo (Center for Economic Studies and Ifo Institute)

Yannis M. Ioannides

Tufts University

Christos Koulovatianos

Department of Finance, University of Luxembourg

Costas Meghir

Yale University; Yale University - Cowles Foundation; Institute for Fiscal Studies (IFS); National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Stylianos Perrakis

Concordia University, Quebec - John Molson School of Business

Emmanuel Petrakis

University of Crete - Department of Economics

Christopher A. Pissarides

London School of Economics & Political Science (LSE); Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics; Hong Kong University of Science & Technology (HKUST)

Vasiliki Skreta

University of Texas at Austin - Department of Economics; University College London

Thanasis Stengos

University of Guelph - Department of Economics

Haridimos Tsoukas

Athens Laboratory of Business Administration (ALBA)

Dimitri Vayanos

London School of Economics; Center for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Nikolaos Vettas

Athens University of Economics and Business - Department of Economics; National and Kapodistrian University of Athens - Faculty of Economics; Centre for Economic Policy Research (CEPR)

Anastasios Xepapadeas

Athens University of Economics and Business; University of Bologna - School of Economics, Management, and Statistics

Date Written: June 26, 2011

Abstract

Greece is at a decisive moment. It has to choose between defaulting and an economic program of structural reforms, privatization, efficient tax collection, and shrinking of the public sector. Unilateral suspension of debt payments would be an economic catastrophe for Greeks, resulting in deep cuts of civil servants' wages and pensions, bankruptcy for Greek banks, and exclusion of Greece from financial markets. An exit from the Euro would be even more disastrous, since it could lead to hyperinflation and extremely high borrowing costs.

Structural reforms and privatization of state corporations will increase competition and efficiency. Reducing the size and increasing the efficiency of the public sector, efficient and fair tax collection, provision of funds for new investment that will promote growth, and bank capital expansion are necessary ingredients of the solution. Rampant corruption has to be dealt with.

Given the catastrophic effects of a unilateral suspension of debt payments, there is no doubt that Greece has to choose the alternative of reform no matter how difficult. Greece has to implement deep structural reforms now.

Keywords: Greece, reforms, bankruptcy, restructuring, privatization

JEL Classification: G01, G10, G20, G28

Suggested Citation

Azariadis, Costas and Constantinides, George and Constantatos, Christos and Dellas, Harris and Economides, Nicholas and Haliassos, Michael and Hatzipanayotou (Xatzipanagiotou), Panagiotis (Panos) and Ioannides, Yannis M. and Koulovatianos, Christos and Meghir, Costas and Perrakis, Stylianos and Petrakis, Emmanuel and Pissarides, Christopher and Skreta, Vasiliki and Stengos, Thanasis and Tsoukas, Haridimos and Vayanos, Dimitri and Vettas, Nikolaos and Xepapadeas, Anastasios, Reforms or Bankruptcy? (June 26, 2011). Kathimerini, June 26, 2011. Available at SSRN: https://ssrn.com/abstract=1874294

Costas Azariadis

Federal Reserve Banks - Federal Reserve Bank of St. Louis ( email )

411 Locust St
Saint Louis, MO 63011
United States

George Constantinides

affiliation not provided to SSRN

Christos Constantatos

University of Macedonia ( email )

156 Egnatia St.
P.O. 1591
Thessaloniki, 54006
Greece

Harris Dellas

University of Bern - Department of Economics ( email )

Gesellschaftstrasse 49
Bern, CH-3012
Switzerland
+41 31 631 3989 (Phone)
+41 31 631 3992 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Nicholas Economides (Contact Author)

New York University - Leonard N. Stern School of Business - Department of Economics ( email )

44 West 4th Street
New York, NY 10012
United States
212-998-0864 (Phone)
212-995-4218 (Fax)

HOME PAGE: http://www.stern.nyu.edu/networks/

Michael Haliassos

Goethe University Frankfurt - House of Finance

Theodor-W.-Adorno-Platz 3
PF H32
Frankfurt am Main, 60323
Germany

Goethe University Frankfurt - Faculty of Economics and Business Administration ( email )

Theodor-W.-Adorno-Platz 3
PF H32
Frankfurt am Main, D-60323
Germany

CEPR

London
United Kingdom

NETSPAR ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Panagiotis (Panos) Hatzipanayotou (Xatzipanagiotou)

Athens University of Economics and Business ( email )

76 Patission Street
Athens, 104 34
Greece

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Yannis M. Ioannides

Tufts University ( email )

Medford, MA 02155
United States

Christos Koulovatianos

Department of Finance, University of Luxembourg ( email )

4 Rue Albert Borschette
Luxembourg, L-1246
Luxembourg

Costas Meghir

Yale University ( email )

37 Hillhouse avenue
New Haven, CT CT 06511
United States
+12034323558 (Phone)

Yale University - Cowles Foundation ( email )

Box 208281
New Haven, CT 06520-8281
United States

Institute for Fiscal Studies (IFS) ( email )

7 Ridgmount Street
London, WC1E 7AE
United Kingdom

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Centre for Economic Policy Research (CEPR)

London
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Stylianos Perrakis

Concordia University, Quebec - John Molson School of Business ( email )

1455 de Maisonneuve Blvd. W.
Montreal, Quebec H3G 1M8
Canada

Emmanuel Petrakis

University of Crete - Department of Economics ( email )

GR-74100 Rethymnon, GR-74100
Greece
+30 28310 77409 (Phone)
+30 28310 77406 (Fax)

Christopher Pissarides

London School of Economics & Political Science (LSE) ( email )

Houghton Street
London WC2A 2AE
United Kingdom
+44 20 7955 7513 (Phone)
+44 20 7831 1840 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Hong Kong University of Science & Technology (HKUST) ( email )

Clearwater Bay
Kowloon, 999999
Hong Kong

Vasiliki Skreta

University of Texas at Austin - Department of Economics ( email )

Austin, TX 78712
United States

HOME PAGE: http://vskreta.wixsite.com/vskreta

University College London ( email )

Gower Street
London, WC1E 6BT
United Kingdom

HOME PAGE: http://vskreta.wixsite.com/vskreta

Thanasis Stengos

University of Guelph - Department of Economics ( email )

50 Stone Road East
Guelph, Ontario N1G 2W1
Canada

Haridimos Tsoukas

Athens Laboratory of Business Administration (ALBA) ( email )

Athinas Ave. & 2A Areos Str.
Vouliagmeni 166 71, Athens
Greece

Dimitri Vayanos

London School of Economics ( email )

A350
Houghton Street
London WC2A 2AE
United Kingdom
+44 (0)20 7955 6382 (Phone)
+44 (0)20 7955 7420 (Fax)

Center for Economic Policy Research (CEPR)

London
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Nikolaos Vettas

Athens University of Economics and Business - Department of Economics ( email )

76 Patission Street
GR-10434 Athens
Greece
+30 210 8203179 (Phone)

National and Kapodistrian University of Athens - Faculty of Economics ( email )

8 Pesmazoglou street
GR-10559 Athens
Greece
+30 210 8203179 (Phone)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Anastasios Xepapadeas

Athens University of Economics and Business ( email )

76 Patission Street
Athens, 104 34
Greece

University of Bologna - School of Economics, Management, and Statistics ( email )

Piazza Scaravilli 1
40126 Bologna, fc 47100
Italy

Register to save articles to
your library

Register

Paper statistics

Downloads
177
Abstract Views
1,224
rank
171,141
PlumX Metrics