Institutional Dynamics and Economic Development in Greece: An Acemoglian Approach

Research in Applied Economics. Vol. 12, No. 1, pp. 12-32, 2020

21 Pages Posted: 2 Apr 2020

See all articles by Charis Vlados

Charis Vlados

Democritus University of Thrace, Department of Economics

Dimos Chatzinikolaou

Democritus University of Thrace, Department of Economics

Date Written: March 6, 2020

Abstract

The evolution of institutions is a theoretical field of increasing interest today. Socio-economic development in the institutional approach results mainly from the historical unfolding and quality of institutions. This paper aims to highlight Daron Acemoglu’s institutional approach, which appears to be gaining prominence gradually, and propose a new theoretical perception of the developmental process of the Greek socio-economic system. It first analyses Acemoglu’s theoretical contribution, it then compares the ‘Acemoglian’ to other approaches and suggests that the analysis of inclusive and extractive institutions based on historically-significant virtuous and vicious circles has value for the Greek case. While several studies tend to focus on the macroeconomic and macro-financial symptoms of the Greek crisis, an evolutionary approach of the deeper institutional dynamics seems to offer a required reposition. We describe and recommend the development and underdevelopment process in terms of an ‘institutionally adaptive socio-economic system’ and ‘competitiveness web’. These findings indicate that development takes place over historically-significant periods, through complex processes of selection and diffusion of institutional restructurings, and that civil societies are responsible for the political forces who represent them, at least in democratic regimes. In the case of Greece, the proposal to utilise an approach of an ‘institutionally adaptive socio-economic system’ can give a repositioned theoretical perception, especially nowadays when the institutional and evolutionary socio-economic analytical classes seem to be gaining interest and prominence.

Keywords: Daron Acemoglu, Greek crisis, why nations fail, socio-economic development, institutionally adaptive socio-economic system, institutional innovations, competitiveness web

Suggested Citation

Vlados, Charis and Chatzinikolaou, Dimos, Institutional Dynamics and Economic Development in Greece: An Acemoglian Approach (March 6, 2020). Research in Applied Economics. Vol. 12, No. 1, pp. 12-32, 2020, Available at SSRN: https://ssrn.com/abstract=3551141

Charis Vlados (Contact Author)

Democritus University of Thrace, Department of Economics ( email )

Komotini
Greece

Dimos Chatzinikolaou

Democritus University of Thrace, Department of Economics ( email )

Komotini
Greece

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