The Greek Public Debt Problem

Levy Economics Institute Working Paper No. 867

31 Pages Posted: 20 May 2016 Last revised: 29 Oct 2016

See all articles by Michalis Nikiforos

Michalis Nikiforos

Bard College - The Levy Economics Institute

Dimitri B. Papadimitriou

Bard College - Levy Economics Institute

Gennaro Zezza

University of Cassino - Department of Economics; Bard College - The Levy Economics Institute

Date Written: May 18, 2016

Abstract

This paper examines the issue of the Greek public debt from different perspectives. We provide a historical discussion of the accumulation of Greece’s public debt since the 1960s and the role of public debt in the recent crisis. We show that the austerity imposed since 2010 has been unsuccessful in stabilizing the debt while at the same time taking a heavy toll on the Greek economy and society. The experience of the last six years shows that the country’s public debt is clearly unsustainable, and therefore a bold restructuring is needed. An insistence on the current policies is not justifiable either on pragmatic or on moral or any other grounds. The experience of Germany in the early post–World War II period provides some useful hints for the way forward. A solution to the Greek public debt problem is a necessary but not sufficient condition for the solution of the Greek and wider European crisis. A broader agenda that deals with the malaises of the Greek economy and the structural imbalances of the eurozone is of vital importance.

Keywords: Greece, Public Debt, Austerity, Eurozone, Crisis

JEL Classification: E62, F34, F41, N10, N94

Suggested Citation

Nikiforos, Michalis and Papadimitriou, Dimitri B. and Zezza, Gennaro, The Greek Public Debt Problem (May 18, 2016). Levy Economics Institute Working Paper No. 867, Available at SSRN: https://ssrn.com/abstract=2781682 or http://dx.doi.org/10.2139/ssrn.2781682

Michalis Nikiforos (Contact Author)

Bard College - The Levy Economics Institute ( email )

Blithewood
Annandale-on-Hudson, NY 12504-5000
United States
(001)845-758-7735 (Phone)

HOME PAGE: http://www.mnikiforos.net

Dimitri B. Papadimitriou

Bard College - Levy Economics Institute ( email )

Blithewood
Annandale-on-Hudson, NY 12504
United States
845-758 7711 (Phone)
845-758 9424 (Fax)

Gennaro Zezza

University of Cassino - Department of Economics ( email )

Cassino
Italy

HOME PAGE: http://gennaro.zezza.it

Bard College - The Levy Economics Institute ( email )

Blithewood
Annandale-on-Hudson, NY 12504-5000
United States

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