Thursday, 28 May 2015

Study finds Greeks lost four tenths of income in crisis

A new study estimates that the average Greek household lost almost four tenths of its income in the first five years of the crisis.

Most of that loss - 23.1 percent - was in direct income, the study says. A further 8.8 percent was lost to increased taxation and another seven percent to inflation not matched by increases in income over the period 2008-2012.

The study is based on the declared income of 5.2 million taxpayers.

The study (Greece: Forms of adaptation, solidarity and inequalities in the crisis period) was unveiled on Thursday by its authors, Tasos Yiannitsis and Stavros Zografakis, economists at Athens University and Athens Agricultural University, respectively.

It found that income from salaries, which affected mainly the middle class and blue collar workers, fell by 27 percent, but income from corporate profits and dividends, which affected the rich, fell by 54 percent, suggesting that all social strata suffered.

However, its authors point out that the losses to the poor, though nominally smaller, were devastating because incomes among the lowest earning households were already low.

The proportion of Greeks living below the poverty line rose from 27.9 percent to 31.1 percent; but economist Panos Tsakloglou said that conceals the true extent of the spread of poverty, because the definition of poverty fell over the same period by a thousand euros to 7,756 euros. In 2008 terms, approximately 40 percent of Greeks are below the poverty line, Tsakloglou said.

In an indication of how badly the Greek state has failed to provide for the neediest during the crisis, the study found that in the poorest 10 percent of households, less than a tenth of income came from social welfare. Most - 62 percent - came from charity and donations from friends and neighbours. 

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