Skip to main content

2023 | Book

Interconnections in the Greek Economy

Between Macro- and Microeconomics


About this book

This book examines the economic interconnections of the Greek economy at a macro and micro level, allowing it to explore both the economic relations between the various sectors and the interconnections of various companies and overlaps in management boards. Two approaches are used to quantify interdisciplinary and cross-sectoral interfaces: the traditional input-output analysis approach and the “influence and information flow” approach through network analysis. The book's first part presents the current conditions and the economic interconnections within the Greek economy. In the second part, during the analysis of microeconomic interconnections between individuals and companies, a much more thorough presentation of the economic interconnections of Greek companies is established. Finally, the book’s third part presents how the Greek economy must transform its production prototype under structural constraints and opportunities for economic diversification and inclusive growth and under the pressure of economic shocks and uncertainty.

Table of Contents


Sectoral Interconnections in the Greek Economy

Chapter 1. Industrial Policy and Productive Transformation: An Optimization Approach Based on Input–Output Analysis
One of the modern economies’ primary objectives is to determine an industrial policy resulting in an improved production-exports structure. A productive structural transformation that shifts production within different sectors through the reallocation of production factors can generate GDP and export growth, thus achieving significant advances in the economy’s external position. Furthermore, import substitution policies focusing on upgrading the country’s position in global value chains can improve the country’s external balance of goods and services and a reduction of the risk of adverse effects on the production process due to macroeconomic imbalances. In this research, a methodology for the optimization of the structural transformation of an economy is proposed, based on Input-Output Analysis (IOA). IOA offers a structural view of industrial relationships and is widely applied for studying the economic effects of structural changes within an economy. The process of structural transformation could achieve significant gains, both in the short term and the long term. Short-term gains would be the achievement of relatively higher economic growth rates as more productive activities are promoted. Long-term gains would be due to technological upgrading, increased accumulative capabilities in key sectors of the economy, and a higher level of international attractiveness.
Maria Markaki, Stelios Papadakis
Chapter 2. Greece Toward 2027: Structural Transformation, Industrial Policy, and Economic Development
The Greek Economy was severely affected by the 2008 economic crisis. The roots of Greece’s unprecedented crisis should be sought in the country’s unfavorable economic structure. The main structural problems of the Greek Economy are limited exports with low diversification; low participation of the manufacturing and technologically advanced sectors in production and exports; weak linkages among different economic activities; high dependency on intermediate and final imports with high-income elasticity of demand; and specialization in activities of low technological level. The above structural features lead to trade-balance deficits and low international competitiveness. Furthermore, the implementation of three Economic Adjustment Programs and the imposed austerity policies failed to drive the Economy into a growth trajectory and have led to an ongoing recession.
The country’s peculiar economic structure emerges as the main obstacle to economic growth and development, and current policies do little to improve the economic situation. Therefore, the transformation of the Greek Economy’s productive structure through appropriate industrial policies is recognized as the only way to achieve economic development. In this chapter, a solution to an optimization problem is presented in the form of an optimal economic structure for the Greek Economy. This optimal structure can boost the growth rate in the country’s Gross Domestic Product (GDP) and reduce the deficit in the balance of goods and services. Furthermore, based on the optimal productive structure, policymakers can pursue a mix of structural policies, integrating sectoral and macroeconomic interventions.
Maria Markaki, Stelios Papadakis
Chapter 3. A Regional Analysis Of Inputs-Outputs Of The Greek Economy: A Baseline Depiction Of Interconnections In Greece
Input–output tables represent both a set of empirical data and a theoretical tool for studying the interconnections and the internal structure of an economy. The method at hand has been widely used both internationally and in Greece to investigate the structuring of the Greek economy and draw conclusions regarding industrial policy and optimal planning for the country. The Greek Statistical Service regularly publishes tables about the entirety of the country which are utilized in this research. Despite the great wealth of studies, there is a large gap in the national literature regarding sectoral interconnections at the level of the country’s various peripheries, although Regional Analyses of Inputs-Outputs have been in wide circulation for decades. Research interest has recently shifted from the national to the regional level, given that the economy is not a non-spatial entity and that interregional trade features greatly in the relationship between the periphery and the center. The aim of the present chapter is to introduce a methodology by means of which input–output tables can be generated for Greece’s several regions and which can then be used to create a basic outline of the sectoral/regional interconnections that occur in the country.
Pagiavla Georgia, Pisinas Yorgos

Relations in the Greek Industries

Chapter 4. Networks in Ownership and Management Structures
Since the beginning of the last century, the interest of economic science has been drawn to corporate interconnections, their connection with the financial system, the formation of alliances, and their relationship with political power. With the development of mathematics, especially graph theory, this interest was boosted. This chapter is intended as an introduction to matters related to the interconnection of corporates. Firstly, graph theory is analyzed at a rudimentary level, and its several forms are described that have been employed by economics, and social sciences in general. Two basic kinds of relationships are distinguished, which are then further specialized: interlocking directorate and interlocking ownership. An analysis is offered of these two aspects and their significance, along with an overview of the bibliography. The several forms of corporate interlocks existing worldwide are then presented in a broad outline. Following this, we focus on the cases found in Greek business networks. The lowest level of interconnections obtains, compared to the rest of Europe, and the similarities with the rest of the European countries are noted in the logic of the network’s articulation. Finally, the chapter concludes with the possibilities and prospects of research into social network analysis in business.
Giorgos Vasilis
Chapter 5. Connected Corporate Networks I: Definitions, Metrics and Empirical Results from the Greek Telecommunications Sector
Since the 1960s, the development of graph theory has made it possible to improve the modelling and visualization of the relationships which are further developed in corporate networks. The latest developments in computational graph theory have introduced new techniques for exploring complex-structured networks. Despite the criticism followed by the increase of research interest (Mizruchi, Annual Review of Sociology 22:271–298, 1996; Zajac, The Academy of Management Journal 31:428–438, 1988), interlocks remain a strong indicator of network links between companies (Mizruchi, Annual Review of Sociology 22:271–298, 1996). This study endeavours to focus on the ability of corporate interconnection analysis to record the complexity and composition of corporate networks, using population data from the Greek ecosystem. In addition, our study of board interlock networks in Greece will provide a solid base for the investigation of a wide range of questions such as power concentration, anti-trust investigation, corporate knowledge transfer, macroeconomic implications and business strategy. The last section of this paper attempts to apply a demonstration of a board interlock network across a particular economic sector of Greece, where our findings provide sufficient evidence of interconnectivity.
Michalis Vafopoulos, Charalampos Agiropoulos, Artemis Gourgioti, Michalis Klonaras
Chapter 6. Connected Corporate Networks II: A Novel Approach to the Competition Measure
Over the last few years, the anti-trust risk of shared ownership is having a moment. Analysts and policymakers, both progressive and conservative, are sending a signal regarding the increasing concentration of shares in the hands of large institutional investors, combined with greater involvement in corporate governance. This study seeks to evaluate the existing measures of market concentration and propose a novel approach to the competition measure [smoothly] combined with the connected corporate network procedure. The proposed index is applied on several business sectors of the Greek economy. The last section of this study discusses the efficiency of the new index compared with traditional measures such as the Herfindahl–Hirschman index and the m-firm concentration ratio.
Charalampos Agiropoulos, Michalis Vafopoulos, Artemis Gourgioti, George Galanos

Economic Shocks, Diversification and Economic Interconnections

Chapter 7. Economic Shocks in Greece and the Effects on the Gross Value Added Per Economic Sector
The outbreak of the recent global financial crisis, the COVID-19 pandemic, and the energy crisis fueled by the effects of the Russian-Ukrainian war caused significant economic turbulence in the Greek economy. Those shocks significantly affected the Greek economy's economic development and growth path and the behaviors and decisions made by economic actors. Simultaneously, those shocks highlighted the speed with which shocks are transmitted in the economy and the significant problems of the Greek economy associated with its structure and function. This chapter investigates how the economic sectors in the Greek economy are affected by the economic shocks that have hit the economy during the period from the first quarter of 1998 up to the third quarter of 2022, leading to the determination of the more vulnerable and the more resilient economic sectors in the Greek economy. Policy recommendations about the transformation of the Greek economy emerge.
Kyriaki I. Kafka
Chapter 8. Identifying Smart Growth Policies for Economic Diversification and Sustainable and Inclusive Growth in the Greek Economy
A country’s productive structure determines its future path of economic diversification, economic growth, and sustainable and inclusive growth. The Greek economy relies significantly on the production of a few economic sectors and, as a result, is vulnerable to external or internal economic shocks. This chapter defines Greece’s structural constraints and opportunities for economic diversification and sustainable and inclusive growth. For this purpose, the analysis describes the production model of the Greek economy and its vulnerabilities. Those vulnerabilities generate the need for its change to a more diversified economy based on sustainable and inclusive growth. Then smart growth policies for the future of the Greek economy are presented based on a Quintuple Helix model, which recognizes the importance of collaboration and cooperation between government, industry, civil society, the environment, and the knowledge and innovation system.
Pantelis C. Kostis
Chapter 9. Networks and Interconnections in an Era of Trending Divergence
Nowadays, economies and societies are experiencing greater connectivity, which results in positive and negative implications for economic constructs as well as higher complexity in terms of network formation. In a world where everything is connected, economic and social shocks spread faster than ever and have severe consequences that are more challenging to mitigate, especially when discussing networks with countries as agents. The present chapter analyzes these topics through the lens of three pillars. First, there is a critical discussion of the emerging positive effects and challenges of an interconnected world at individual, social, and economic levels. Second, the analysis focuses on the role of networks in the prediction of the future and provides insights for the future of world cooperation under specific circumstances. Lastly, the reasoning is concentrated on the role of human and creative capital in mitigating divergence tendencies, concluding this chapter.
Anna-Maria Kanzola
Interconnections in the Greek Economy
Panagiotis E. Petrakis
Copyright Year
Electronic ISBN
Print ISBN

Premium Partner