Thesis (Ph.D.)--Boston University. / The economic problem of Greece is basically the persistent
imbalance between resources and population. Previous attempts to establish
the Greek economy on a long-run, sound economic basis by developing
the domestic resources of the country fell short of their objective. In
the past, the rate of resources utilization through capital investment,
technological improvements, and institutional changes has been inadequate
to support the growing population at a rising scale of living. Furthermore,
post-war population growth may dissipate the economic gains achieved
by foreign aid and may lead again to a new economic relapse.
In Chapter I a concept of demographic equilibrium is developed
which substitutes for the natural subsistence of the Malthusian equilibrium
the concept of conventional subsistence and takes into consideration the
attitudinal aspects of the people with regard to the scale of living. The
objective of economic development is accepted as the establishment of
conditions of demographic equilibrium achieved by a rate of resources
utilization higher than the rate of population increase that results in a
rising scale of living in accordance with desired standards.
The approach in this study is historical and statistical. The
objective is to analyze the direction which economic progress has taken in
the past and to observe to what extent previous attempts were successful
or unsuccessful in altering the course of economic change under a continuously
growing population. Present developments are better understood
when they are observed through conclusions drawn from past experience.
The importance of natural resources is emphasized in Chapter II.
The belief held among geographers that Greece constitutes an integral
part of a world region termed AEgeis, a region occupying the greatest
part of the eastern Mediterranean basin, cannot be explained without
the presence of limited domestic resources on the Greek peninsula.
These limited resources forced the surplus population to colonize and
contributed to an economic prosperity based principally on transport-commerce-
service activities. In the long history of Greece, the
economic prosperity of the Greek peninsula was externally conditioned,
depending on the changing economic significance of the region.
In Chapter III a statistical analysis is conducted concerning
the extent and nature of Greece's dependence on foreign trade. The
propensity to trade and the per capita trade of Greece are the highest
in the world. Measurements reveal that most of the increase in trade
was necessary for the support of a growing population at an almost
stationary scale of living.
The persisting imbalance between population and domestic
resources is also evidenced by a chronic trade deficit. Increasing
visible imports were not met by a corresponding increase in visible
exports. The deficit was met by invisible exports and borrowing.
Furthermore, the chronic trade deficit indicates that Greece has never
passed the borrowing stage.
A cyclical trade disequilibrium was superimposed on the
secular trade deficit. Measurements show that both visible and
invisible export receipts are relatively more elastic than import
expenditures. The nature of Greece's trade dependence is further
explained by the monocultural character of the economy and the fact that
Greece is a small buyer and seller in world trade.
Post-war foreign aid has contributed little in moderating this
monocultural economy. Furthermore, World War II has created some
unfavorable conditions for Greek trade. As the balance of payments is
a limiting factor on the size of the investment program, high trade
dependence seriously restricts the prospects for economic development,
and the population factor assumes paramount importance.
Further evidence of the persistent imbalance between resources
and population is offered in Chapter IV. The Greek economy is investigated
during the period of free migrations and trade (1828-1920). The
population of Greece increased from 753,000 to 5,017,000. About
two-thirds of the increase came from territorial acquisitions. Excess
birth rates and some net immigration account for the remainder.
Economic conditions in the domestic economy remained practically
stagnant. Limited land, a feudal-like land tenure, primitive methods
in production, and lack of capital restricted employment opportunities
in agriculture. Manufacturing was largely a household operation.
Foreign capital, borrowed by the government on heavy terms, was mostly
spent on unproductive undertakings and led the country into default.
Close correlation was found between the increase in population
and imports. Percentwise, visible exports declined, while emigrant
remittances and shipping earnings rose in importance. Migratory
movements were almost continuous, especially with Greeks settled along
the Anatolian littoral. Extensive emigration, especially overseas, at
the turn of the century was more than offset by repatriation and the
influx of refugees, even before the compulsory exchange of minorities
in the Balkans.
It is most likely that the scale of living did not improve
after the third default of the country in the 1890's. This likelihood,
together with the extensive overseas emigration, strongly suggests
that conditions of demographic equilibrium were not established.
The 1920's witnessed a mass in-migration of refugees and the
first inter-war attempt toward economic adjustment. This is the subject
of Chapter V. Population increased qy about 1,450,000 to approximately
6,472,000 in 1931. About 300 million 1947-49 U.S. dollars of foreign
capital entered the country.
Yet, this reconstruction scheme was not successful. The refugee
settlement, the agrarian reform, and rising excess birth rates resulted
in uneconomic parcelation of the land and small-scale subsistence
farming. Extensive cultivation accounts for the largest part of the
increase in agricultural production. The growing imbalance between
capital-resources and population is evidenced by the increase in
labor-absorbing lines of farm production. Despite progress, manufacturing
fell short of taking care of the large urban underemployment.
Furthermore, manufacturing exports comprised a very small fraction of
total commodity exports.
A balanced budget, a stabilized currency, and a restored
monetary and credit mechanism were an economic bonanza. The depression
of the 1930's put an early end to this first scheme. Greece fell into
default again. Per capita real income never reached pre-World War I
levels during the 1920's. Even with milder or no cyclical effects
at all, it is problematic whether the Greek economy would be able to
export an adequate surplus to meet foreign loan obligations, much less
maintain a rising scale of living.
Chapter VI deals with the policy for economic autarchy of the
1930's, which constitutes the second inter-war attempt toward economic
adjustment. Total gross investments, mostly forced savings through
bootstrap-like operations, are estimated at between 600 and 700 million
1947-49 dollars.
Agriculture proper received first and most attention. The
weighted index of agricultural production, 1928 : 100, averaged 211 in
1937-38. Despite the drive for intensive production, extensive cultivation
accounts for most of the increase in output. The animal-vegetable
ratio showed marked signs of declining. The gains in greater output
were largely the result of high tariffs. An increase in industrial
production was not followed by a corresponding increase in employment.
During the 1930's population increased by about 950,000 to
7,345,000 in 1940 because of high excess births. Measurements estimate
that Greece had a 1,424,000 "surplus" agricultural population. Most
likely, per capita income did not reach pre-World War II levels.
Deterioration of nutritional standards through a fall in the animal-vegetable
ratio at the consumption level and inferior manufactured goods
domestically produced behind high tariffs most probably have taken place.
International accounts were balanced and employment opportunities increased,
but the policy for economic autarchy fell short of establishing
conditions of demographic equilibrium.
The subject of Chapter VII concerns the third attempt toward
economic adjustment through post-war foreign aid. Widespread destruction,
guerrilla warfare, and political instability delayed economic
recovery. Finally, by 1952 economic conditions were improved, and the
first post-war stable government came into power.
However, prospects for maintaining conditions of demographic
equilibrium are not encouraging. From over 2 billion dollars of foreign
aid, only about 450 raillion were invested in long-run developmental
projects. The drastic cut in foreign aid for 1953-54 and the limited
availability of capital from domestic and foreign sources emphasize
again the importance of population.
In the past, continuous population increase has underscored
and aggravated the economic difficulties of Greece. Post-war vital
statistics indicate that the population of Greece is increasing rapidly,
from 10 to 12 per thousand annual rate on the 1951 population census
of 7,631,000. Fertility decline depends on the slow process of
demographic transition. Emigration on an adequate scale is neither
easily attainable nor acceptable on general grounds. At the same time,
a higher scale of living is not only socially desirable but regarded as
a matter of social justice. The ensuing relative deprivation may result
in widely spread social unrest with corresponding political and ideological
implications.
In the final chapter (VIII) a summary of the findings is made,
together with the following concluding remarks: The present rate of
resources utilization may prove to be inadequate to support the rapidly
increasing post-war population at a rising scale of living. Even prospects
brighter than those of the present with respect to availability of
capital and the renewal of foreign aid for the continuation of the
development program, or to the integration of Greece into a European
economy do not justify the absence of attempts on the part of the
government to control future population growth.
| Identifer | oai:union.ndltd.org:bu.edu/oai:open.bu.edu:2144/8818 |
| Date | January 1954 |
| Creators | Theodore, Chris Athanasios |
| Publisher | Boston University |
| Source Sets | Boston University |
| Language | en_US |
| Detected Language | English |
| Type | Thesis/Dissertation |
| Rights | Based on investigation of the BU Libraries' staff, this work is free of known copyright restrictions. |
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