The Transformation of Employment Regulation in Greece: Towards a Dysfunctional Liberal Market Economy?

Since the eruption of the European sovereign debt crisis, the bailout conditions imposed on Greece have gradually shifted their emphasis from "tidying up" public finances towards "improving the competitiveness" of the economy. The employment relations system has been targeted as one of the priority areas for reform, which resulted in its gradual dismantling. The article analyses this transformation in employment regulation, using insights from the varieties of capitalism literature. It is argued that the ongoing injection of liberal market elements is likely to transform Greece into a dysfunctional Liberal Market Economy. The changes ignore the specificities and idiosyncrasies of the Greek production model and are likely to leave the country with the "worst of both worlds": suboptimal economic performance and diluted social cohesion.