Early Warning Signs of the Economic Crisis in Greece: A Warning for Other Countries and Regions

Ron W. NIELSEN

Abstract


Abstract. Warning signs about the developing economic crisis in Greece were present in the growth rate of the Gross Domestic Product (GDP) and in the growth of the GDP well before the economic collapse. The growth rate was strongly unstable. On average, in less than 50 years, it decreased 10-folds but after reaching a low minimum it quickly increased 6-folds only to crash before completing the full cycle. The decreasing growth rate was leading to an asymptotic maximum of the GDP but it was soon replaced by a fast-increasing growth rate propelling the GDP along a pseudo-hyperbolic trajectory, which if continued would have escaped to infinity in 2017. Such a growth could not have been possibly supported. Under these conditions, the economic collapse in Greece was inevitable.

Keywords. Economic growth, Gross Domestic Product, Greece, Economic crisis, Future economic growth, Early warning signs.

JEL. C00, C20, C40, C50, C53, C60, C80.


Full Text:


References


Felton, A., & Reinhart, C. (2008). The first global financial crisis of the 21st century. CEPR: London.

Katsimi, M., & Moutos, T. (2010). EMU and the Greek crisis: The political-economy perspective. European Journal of Political Economy, 26(4), 568–576. doi. 10.1016/j.ejpoleco.2010.08.002

Kotios, A., & Pavlidis, G. (2012). International economic crises: Systemic or policy crises? Rosili: Athens.

Lapavitsas, C. (2009). The roots of the global financial crisis. Development Viewpoint, April, 28.

Lyrintzis, C. (2011). Greek politics in the era of economic crisis: Reassessing causes and effects, LSE Research Online, Hellenic Observatory papers on Greece and Southeast Europe, GreeSE paper no. 45. The Hellenic Observatory, London School of Economics and Political Science, London.

Nielsen, R. W. (2015a). The Insecure Future of the World Economic Growth. Journal of Economic and Social Thought, 2(4), forthcoming.

Nielsen, R. W. (2015b). Mathematics of Predicting Growth. Turkish Economic Review, 2(4), forthcoming.

Oltheten, E., Pinteris, G. & Sougiannis, T. (2003). Greece in the European Union: Policy lessons from two decades of membership. Quarterly Review of Economics and Finance, 43(5), 774–806. doi. 10.1016/S1062-9769(03)00049-8

Petrakos, G., Fotopoulos, G. & Kallioras, D. (2012). Peripherality and integration: Industrial growth and decline in the Greek regions, Environment and Planning C: Government and Policy, 30(2): 347–361. doi. 10.1068/c10171r

US Senate, (2011). Wall Street and the financial crisis: Anatomy of a financial collapse, Majority and Minority Staff Report.

World Bank (2015). GDP Statistics from the World Bank,




DOI: http://dx.doi.org/10.1453/jepe.v2i4.562

Refbacks

  • There are currently no refbacks.


Bookmark and Share


.......................................................................................................................................................................................................................................................................................................................................

Journal of Economics and Political Economy - J. Econ. Pol. Econ. - JEPE - www.kspjournals.org

ISSN: 2148-8347

Editor: jepe@ksplibrary.org   Secretarial: secretarial@ksplibrary.org   Istanbul - Turkey.

Copyright © KSP Library