IDEAS home Printed from https://ideas.repec.org/a/gam/jijfss/v12y2024i4p129-d1550330.html

GINI’s Odyssey in Greece: Econometric Analysis of Income Inequality, GDP, and Unemployment Through Economic Phases (Pre-Crisis, Crisis, Memoranda, and Post-Memoranda)

Author

Listed:
  • Panagiotis Karountzos

    (Department of Regional and Economic Development, School of Applied Economics and Social Sciences, Agricultural University of Athens, 118 55 Athens, Greece)

  • Nikolaos T. Giannakopoulos

    (BICTEVAC Laboratory—Business Information and Communication Technologies in Value Chains Laboratory, Department of Agribusiness and Supply Chain Management, School of Applied Economics and Social Sciences, Agricultural University of Athens, 118 55 Athens, Greece)

  • Damianos P. Sakas

    (BICTEVAC Laboratory—Business Information and Communication Technologies in Value Chains Laboratory, Department of Agribusiness and Supply Chain Management, School of Applied Economics and Social Sciences, Agricultural University of Athens, 118 55 Athens, Greece)

  • Kyriaki I. Efthalitsidou

    (Department of Business Administration, School of Economic Sciences, University of Western Macedonia, 501 00 Kozani, Greece)

  • Stavros P. Migkos

    (Department of Accounting & Finance, School of Economic Sciences, University of Western Macedonia, 501 00 Kozani, Greece)

Abstract

This study explores the relationship between income inequality, economic growth, and unemployment in Greece from 2003 to 2020, encompassing key economic phases: pre-crisis, crisis, memoranda, and post-memoranda. The aim is to analyze how economic growth (logarithm of GDP-LOGGDP) and unemployment influenced income inequality (GINI coefficient) during periods of economic turmoil and recovery. Using linear regression analysis on 18 years of annual data, this study identifies significant relationships between the variables, with diagnostic tests confirming model robustness. The findings reveal a strong positive and statistically significant relationship between LOGGDP and income inequality, indicating that economic growth, without effective redistributive mechanisms, exacerbated disparities. Unemployment had an even stronger positive effect on inequality, highlighting its role in deepening income disparities, particularly during the crisis years marked by economic contraction and austerity measures. These results underline the critical need for balanced economic policies that promote inclusive growth while addressing structural inequalities and labor market vulnerabilities. This study also employs advanced econometric methods, including Vector Autoregression (VAR), Vector Error Correction Model (VECM), and Granger Causality Test, to analyze the dynamics between GDP (LOGGDP), income inequality (GINI), and unemployment. The Granger Test reveals that unemployment Granger-causes GDP with a two-period lag, highlighting the importance of labor market conditions for economic growth, while no direct causal relationship is found between GDP and inequality. These methods provide deeper insights into the short- and long-term interactions, offering valuable guidance for balanced economic policymaking.

Suggested Citation

  • Panagiotis Karountzos & Nikolaos T. Giannakopoulos & Damianos P. Sakas & Kyriaki I. Efthalitsidou & Stavros P. Migkos, 2024. "GINI’s Odyssey in Greece: Econometric Analysis of Income Inequality, GDP, and Unemployment Through Economic Phases (Pre-Crisis, Crisis, Memoranda, and Post-Memoranda)," IJFS, MDPI, vol. 12(4), pages 1-19, December.
    • Handle: RePEc:gam:jijfss:v:12:y:2024:i:4:p:129-:d:1550330
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2227-7072/12/4/129/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2227-7072/12/4/129/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. François Bourguignon, 2015. "The Globalization of Inequality," Economics Books, Princeton University Press, edition 1, number 10433, December.
    2. José Alves & José Carlos Coelho & Alexandre Roxo, 2022. "How Economic Growth Impinges on Income Inequalities?," CESifo Working Paper Series 10154, CESifo.
    3. George Petrakos & Konstantinos Rontos & Chara Vavoura & Ioannis Vavouras, 2023. "The Impact of Recent Economic Crises on Income Inequality and the Risk of Poverty in Greece," Economies, MDPI, vol. 11(6), pages 1-23, June.
    4. Panagiotis Kotsios, 2022. "Income Inequality Measurements through Tax Data: the case of Greece," Bulletin of Applied Economics, Risk Market Journals, vol. 9(2), pages 175-187.
    5. Theodore Mitrakos, 2014. "Inequality, poverty and social welfare in Greece: distributional effects of austerity," Working Papers 174, Bank of Greece.
    6. Manos Matsaganis & Chrysa Leventi, 2014. "Poverty and Inequality during the Great Recession in Greece," Political Studies Review, Political Studies Association, vol. 12(2), pages 209-223, May.
    7. Tassos Giannitsis & Stavros Zografakis, 2018. "Crisis management in Greece," IMK Studies 58-2018, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    8. Mr. Ravi Balakrishnan & Mr. Chad Steinberg & Mr. Murtaza H Syed, 2013. "The Elusive Quest for Inclusive Growth: Growth, Poverty, and Inequality in Asia," IMF Working Papers 2013/152, International Monetary Fund.
    9. Rubens Penha Cysne, 2009. "On the Positive Correlation between Income Inequality and Unemployment," The Review of Economics and Statistics, MIT Press, vol. 91(1), pages 218-226, February.
    10. Seher Gülşah Topuz, 2022. "The Relationship Between Income Inequality and Economic Growth: Are Transmission Channels Effective?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 162(3), pages 1177-1231, August.
    11. Mr. Jonathan David Ostry & Mr. Andrew Berg & Mr. Charalambos G Tsangarides, 2014. "Redistribution, Inequality, and Growth," IMF Staff Discussion Notes 2014/002, International Monetary Fund.
    12. Jonathan David Ostry & Andrew Berg & Charalambos G Tsangarides, 2014. "Redistribution, Inequality, and Growth," IMF Staff Discussion Notes 14/02, International Monetary Fund.
    13. Juselius, Katarina & Dimelis, Sophia, 2019. "The Greek crisis: A story of self-reinforcing feedback mechanisms," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy, vol. 13, pages 1-22.
    14. Nikolić, Stefan & Novokmet, Filip & Larysz, Piotr Paweł, 2024. "Income inequality in Eastern Europe: Bulgaria and Czechoslovakia in the twentieth century," Explorations in Economic History, Elsevier, vol. 94(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Svetoslav Danchev & Georgios Gatopoulos & Niki Kalavrezou & Antonis Mavropoulos & Grigoris Pavlou & Nikolaos Vettas, 2024. "Equally poorer: inequality and the Greek debt crisis," Fiscal Studies, John Wiley & Sons, vol. 45(3), pages 359-375, September.
    2. Saha, Anjan K. & Mishra, Vinod, 2020. "Genetic distance, economic growth and top income shares: Evidence from OECD countries," Economic Modelling, Elsevier, vol. 92(C), pages 37-47.
    3. Akisik, Orhan & Gal, Graham, 2023. "IFRS, financial development and income inequality: An empirical study using mediation analysis," Economic Systems, Elsevier, vol. 47(2).
    4. Nora Lustig & Daniel Teles, 2016. "Inequality convergence: How sensitive are results to the choice of data?," Working Papers 412, ECINEQ, Society for the Study of Economic Inequality.
    5. Florian Freund, 2021. "The role of coalitions at international tariff negotiations: a CGE perspective," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 157(3), pages 583-601, August.
    6. Stiglitz, J.E., 2016. "An agenda for sustainable and inclusive growth for emerging markets," Journal of Policy Modeling, Elsevier, vol. 38(4), pages 693-710.
    7. Regina Pleninger & Jakob de Haan & Jan‐Egbert Sturm, 2022. "The ‘Forgotten’ middle class: An analysis of the effects of globalisation," The World Economy, Wiley Blackwell, vol. 45(1), pages 76-110, January.
    8. Francisco G. Ferreira & Nora Lustig & Daniel Teles, 2015. "Appraising cross-national income inequality databases: An introduction," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 13(4), pages 497-526, December.
    9. Nora Lustig, 2018. "Measuring the Distribution of Household Income, Consumption and Wealth: State of Play and Measurement Challenges," Working Papers 1801, Tulane University, Department of Economics.
    10. Johannes Tabi Atemnkeng & Laura Senke Ngeh & Nkwetta Ajong Aquilas & Afuge Ramsy Akame, 2024. "Income inequality thresholds that should be avoided for governance to promote economic growth with evidence from Africa," African Development Review, African Development Bank, vol. 36(4), pages 594-607, December.
    11. Iván González Gordón & Budy P. Resosudarmo, 2019. "A sectoral growth‐income inequality nexus in Indonesia," Regional Science Policy & Practice, Wiley Blackwell, vol. 11(1), pages 123-139, March.
    12. Mihaylova Svilena & Bratoeva-Manoleva Silviya, 2017. "Social Transfers and Income Inequality in Bulgaria," South East European Journal of Economics and Business, Sciendo, vol. 12(1), pages 38-49, April.
    13. Kate PHILIP, 2025. "Public Employment Programmes in South Africa’s Changing Social Protection Landscape," Working Paper a81a7ff1-ce8b-4803-b5ad-7, Agence française de développement.
    14. repec:spo:wpmain:info:hdl:2441/gmkj8k1vf8tpbdue5q2emsepp is not listed on IDEAS
    15. Mr. Raphael A Espinoza & Mrs. Esther Perez Ruiz, 2014. "Labor Tax Cuts and Employment: A General Equilibrium Approach for France," IMF Working Papers 2014/114, International Monetary Fund.
    16. Jong Woo Kang, 2015. "Interrelation between Growth and Inequality," ADB Economics Working Paper Series 447, Asian Development Bank.
    17. Gheorghe Savoiu & Vasile Dinu, 2015. "Economic paradoxism and meson economics," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 17(39), pages 776-776, May.
    18. Can Sever & Emekcan Yucel, 2021. "Electoral Cycles in Inequality Abstract:," Working Papers 2021/01, Bogazici University, Department of Economics.
    19. repec:vuw:vuwcpf:3497 is not listed on IDEAS
    20. Nasfi Fkili Wahiba & Mahmoudi Dina, 2023. "Technological Change, Growth and Income Inequality," International Journal of Economics and Financial Issues, Econjournals, vol. 13(1), pages 121-131, January.
    21. Emile Cammeraat, 2020. "The relationship between different social expenditure schemes and poverty, inequality and economic growth," International Social Security Review, John Wiley & Sons, vol. 73(2), pages 101-123, April.
    22. Pasquale Tridico, 2015. "The Rise Of Income Inequality In Oecd Countries," Departmental Working Papers of Economics - University 'Roma Tre' 0201, Department of Economics - University Roma Tre.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jijfss:v:12:y:2024:i:4:p:129-:d:1550330. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.