Social protection of non-standard work in Greece

This brief paper aims to describe key aspects of employment in Greece, to provide some information on levels of, and trends in, non-standard work in Greece, to elaborate on the nature and characteristics of different types of such work, to analyse existing social policies to protect the workers concerned, and to speculate on future developments.

Estimating the distributional effects of mortgage interest tax relief in Europe

This paper attempts to contribute to the analysis of mortgage interest tax relief from the perspective of the economics of social policy. It begins with a brief discussion of fiscal welfare, highlighting key contributions within this particular intellectual tradition. It then contrasts this largely critical approach to the standard, more neutral, treatment of mortgage interest tax relief in the housing literature. Finally, the paper draws on both approaches to present on-going research on the distributional effects of mortgage interest tax relief in Europe.tax relief, inequality, microsimulation

Pathways to a universal basic pension in Greece

Although basic pension had for years failed to catch the imagination of policy makers in Greece, it was suddenly brought to the agenda in the context of the severe crisis raging since November 2009. In May 2010 the government committed to a harsh austerity programme, aiming at fiscal consolidation, in return for a rescue package easing the sovereign debt crisis. The July 2010 pension reform, a key provision of the austerity programme, provided for the introduction of a near-universal basic pension from 2015. The paper attempts to explain why, paradoxically, the crisis made more realistic a universal basic pension in Greece. We argue, firstly, that social insurance pensions may be ripe for path-breaking reform if heavily subsidised in a non-transparent way, and, secondly, that any progress towards basic income is likely to be gradual, uneven and specific to the national policy context.Universal basic pension, Greece, economic crisis, 2010 reform

Why Grexit cannot save Greece (but staying in the Euro area might). LEQS Discussion Paper No. 123/2017 August 2017

Grexit was narrowly averted in summer 2015. Nevertheless, the view that Greece might be better off outside the Euro area has never really gone away. Moreover, although Marine Le Pen’s bid for the French presidency was frustrated in May 2017, in Italy a disparate coalition, encompassing Beppe Grillo’s Movimento Cinque Stelle as well as Matteo Salvini’s Lega Nord, has called for a referendum on exiting the Euro. In this context, our argument that Grexit cannot save Greece may be of some relevance to national debates elsewhere in Europe. The paper examines the case for Grexit by offering a detailed account of its likely effects. Its structure is as follows. Section 2 analyses the transition, with the two currencies (old and new) coexisting. Section 3 charts the challenges facing the Greek economy in the short term, after the new national currency has become legal tender. Section 4 assesses prospects in the medium term, with Grexit complete and the new currency drastically devalued. Section 5 reviews the underlying weaknesses of Greece’s growth regime and explains why these are unrelated to the nominal exchange rate. Section 6 discusses the conditions for an investment-led recovery, and shows why tackling them would be more difficult outside the Euro area. Section 7 sums up and concludes

Earnings Determination and Taxes: Evidence from a Cohort Based Payroll Tax Reform in Greece

This paper analyzes the response of earnings to payroll tax rates using a cohort-based reform in Greece. All individuals who started working on or after 1993 face permanently a much higher earnings cap for payroll taxes, creating a large and permanent discontinuity in marginal payroll tax rates by date of entry in the labor force for upper earnings workers. Using full population administrative Social Security data and a Regression Discontinuity Design, we estimate the long-term incidence and effects of marginal payroll tax rates on earnings. Standard theory predicts that, in the long run, new regime workers should bear the entire burden of the payroll tax increase (relative to old regime workers). In contrast, we find that employers compensate new regime workers for the extra employer payroll taxes but not for the extra employee payroll taxes. We do not find any evidence of labor supply responses around the discontinuity, suggesting low efficiency costs of payroll taxes. The non-standard incidence results are the same across firms of different sizes. Tax incidence, however, is standard for older workers in the new regime as they bear both the employee and employer tax. Those results, combined with a direct small survey of employers, can be explained by social norms regarding pay seniority which create a growing wedge between pay and productivity as workers age.payroll taxes, Greece

Distributional implications of the crisis in Greece in 2009 - 2012

The severe economic crisis affecting Greece since 2009 is having an unprecedented impact in terms of job and income losses, and is widely perceived to have a comparably significant effect in terms of greater inequality and increased poverty. We provide an assessment of whether (and to what extent) the latter is the case. More specifically, we use the European tax-benefit microsimulation model EUROMOD in order to quantify the impact of the austerity (i.e. fiscal consolidation policies) and the recession (i.e. negative developments in the wider economy) on the distribution of incomes in 2009-2012, and estimate how the burden of the crisis has been shared across income groups. We conclude by discussing the policy implications of our research

The impact of mortgage interest tax relief in the Netherlands, Sweden, Finland, Italy and Greece

Fiscal welfare, i.e. the use of the tax system to achieve social policy goals, is assuming ever greater importance throughout Europe and beyond. In housing, the favourable tax treatment of mortgage interest repayments has often coexisted alongside public programmes of housing benefit or social housing. Although the distributional effects of tax expenditure are known to be regressive, the issue has remained relatively under-researched. The paper uses the European tax-benefit model EUROMOD to quantify the distributional impact of mortgage interest tax relief in five European countries: the Netherlands, Sweden, Finland, Italy and Greece. The analysis reveals that higher-income groups capture a disproportionate share of total expenditure on mortgage interest tax relief in all countries, and that this effect is most regressive in the Netherlands and least regressive in Sweden. The paper concludes with a discussion of results and their policy implications

The distributional impact of the crisis in Greece

The severe economic crisis affecting Greece is widely expected to have a significant social impact in terms of greater inequality and increased poverty. We provide an early assessment of whether (and to what extent) this is the case. More specifically, we distinguish between two inter-related factors: on the one hand, the austerity measures taken to reduce fiscal deficits; on the other hand, the wider recession. Using the European tax-benefit model EUROMOD we attempt to quantify the distributional implications of both. With respect to the austerity measures, we focus on the changes introduced in spring 2010 affecting income tax, pension benefits and public sector pay. With respect to the wider recession, we model the effects of rising unemployment and inflation, as well as of lower earnings for self-employed workers and for employees of private firms. In simulating the impact of these changes on the distribution of incomes (and in estimating how the total burden of the crisis is shared across income groups), we take into account tax evasion and benefit non take up. We end by discussing the methodological pitfalls and policy implications of our research