Greece - The effects of the austerity policy - December 31, 2017

Two researchers from the Labour Institute of the General Confederation of Labour published a critical assessment of the impact of the austerity policy. According to the authors, consolidation plans usually bring with them reductions in public sector wages with negative spill-overs to the wage-setting process in the private sector. This not only suffocates directly consumer spending. As long as private consumption represents an important, if not the most important, determinant of aggregate demand, it also negatively feeds back on employment, ultimately endangering a vicious spiral of depressed consumption, employment and growth. Their plea is to put in place labour protective regulations assuring decent wages and working conditions with a view to operate as a buffer stock against deflation, supporting the level of internal demand and sound financial conditions.

Read on: in English …   

For more information, please contact the editor Jan Cremers or Nuria Ramos Martin, Amsterdam Institute for Advanced Labour Studies (AIAS) cbn-aias@uva.nl or the communications officer at the ETUI, Willy De Backer wdebacker@etui.org. For previous issues of the Collective bargaining newsletter please visit http://www.etui.org/E-Newsletters/Collective-bargaining-newsletter. Since June 2013 readers can consult our archive and search through all articles in our database at www.cbnarchive.euYou may find further information on the ETUI at www.etui.org, and on the AIAS at www.uva-aias.net.

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