Economic crisis, COVID-19 pandemic, and the Greek model of capitalism

Abstract

In this paper, we use varieties of capitalism as an analytical tool to understand the main characteristics of the Greek model of capitalism. The main purpose of this paper is twofold: first, to study the evolution of the country's economic performance through the theoretical approach of varieties of capitalism; second, highlighting the performance of institutions to understand how the main characteristics of the Greek model of capitalism have been changed during last years. The main questions of the article are: How the Greek model of capitalism affected not only the institutional but also the economic performance in Greece? Does the COVID-19 pandemic influence the model of capitalism in Greece? By applying the principles of the comparative political economy, we will be able to draw conclusions regarding the institutional performance in Greece and the characteristics of the Greek model of capitalism. As we will argue, the Greek model of capitalism was shaped by the power of ideas of country's political leaders since 1980s. These ideas influenced the characteristics of the Greek model of capitalism creating a rather exceptional institutional framework unable to support long- run economic growth in the country. This exceptionalism is associated with an institutional asymmetry in relation with other member states and characterizes the Greek model of capitalism not only as the main cause for the economic crisis, but also as a significant obstacle to any recovery efforts, especially during COVID-19 pandemic.