Economic Policies in Greece During 1990-1993: An Assessment

Abstract

This paper deals with the assessment of the economic policy followed during the period 1990-1993 in Greece. It analyzes in particular the evidence and the results of the applied conservative prescription at that time. While the results of this policy proved to be negative according to the arguments as well as the findings of this paper, a new policy agenda is sketched out. Proposed policy directions share the view that in order to break away from the economic crisis in Greece, priority should be given to economic growth, paying attention to public investments in infrastructure in order to generate productivity increase of the private sector, raise the level of business activity, and reduce the risks facing individual firms. A differentiated, selective and, according to market signals, gradual sliding of the national currency is this paper's proposal for the crucial field of exchange rate policy.