A Proper Developmental State Framework for Greece

Abstract

Post World War II, Greece was enjoying, by and large, significant economic growth that was only slightly lower than that of other Western European nations. However, immediately after the financial crisis of 2007-08, the country faced a sovereign debt crisis. This continuing multifaceted crisis reached the populace as a series of restrictive measures and sudden reforms (what Galbraith, 2016, labels ‘economic policy as moral abomination’), which resulted in a very long recession, high unemployment, massive inequalities and marginalization, increased social exclusion, and huge migration of thousands of well-educated Greeks. Within such economic development context, this contribution provides an overview of Greece’s past economic development efforts and challenges (Section 2); discusses important notions of a highly interventionist developmental state framework with ‘Greek characteristics’ as its main focus (Section 3); and offers developmental state-based policy implications, which are deemed necessary for the revival and global repositioning of Greek industrial sectors of high potential and achievability (Section 4). Summary and conclusions end the article.

JEL: F1, F6, O1, O2.