INCOME INEQUALITY AND ECONOMIC CRISIS
Economists use different expressions to describe the economic problems: delay, stagnation,
stagflation, recession, depression. However, the most widespread manifestation of this crisis
is economic, as well as growth structural, debt, global etc. The global economic crisis that we
still feel these days , started in 2007 of the first "bubbles " that appear in the real estate
market in the United States .The crisis reached Europe from the debt crisis that was
dramatic in 2010 and began the collapse of the PIIGS ( Portugal , Ireland , Iceland , Greece
and Spain ) . Furthermore, the European Economic and Monetary Union was equally waver.
A phenomenon caused by the economic crisis is that of income inequality. Income inequality
affects not only the economy but also society in general. The term typically refers to
inequality among individuals and groups within a society, but can also refer to inequality
among countries.
GREEK AND GLOBAL ECONOMIC CRISIS
The first signs of the global financial crisis had many years as a starting point before the
crisis of 2007 . Occurred after the outbreak of the problems in the mortgage market to
ensure low and reckless use of structured investment products that depend directly on the
ability to repay loans of which produced . One of the first victims of the financial crisis of
2008 was Iceland. The crisis spread to other parts of Europe such as the Balkan countries.
The biggest victim of the crisis was Greece. Following the revelations of the high fiscal
deficit, forced Greece to make an early election. The government that took over leadership
of Greece fled to the memorandum. Despite other European countries such as Iceland
Greece was unable to escape the crisis.
One of the major problems faced by countries affected by the economic crisis is the
income inequality. It is a phenomenon that has no positive felt only negative on both
economic and social structure of the country. The crisis did affect Greece felt the problem of
income inequality to a greater extent, which was one of the problems that were added to
the Greek economy.
CAUSES OF INCOME INEQUALITY
The politics of austerity and the tactical mistake of dealing with the problems of Greece
enlarge the gap between the wages. The causes of their concern are clear: high
unemployment and underemployment in developed and developing economies inadequate
training given to young people and workers are invited to compete for jobs in a globalized
environment, the loathing that causes corruption, including legalized forms like "lobby" ∙ and
the sharp widening of inequality in income and wealth in the developed world and the
fastest growing emerging economies. Τhere are gender differences in income inequality:
between 1979 and 2005, for example, the income gap between women working for the
median wage and low-earning women grew much more than it did for men at those income
levels during the same period. That suggests that the decline in the real value of the
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minimum wage over that time played a causal role. That's not surprising, in one sense, since
women are, roughly speaking, twice as likely to work for the minimum wage as men are.
EFFECTS OF INCOME INEQUALITY
Result of inequality is the increase in borrowing by the private and public sector and
associated with this phenomenon bubbles in debt , equities and real estate. The modest
increase in real income for all but the wealthiest of the past few decades opened a gap
between income and consumer aspirations . In Greece , the gap was bridged with public
services , such as free education , health , etc. , but not fully financed by taxes , resulting in
soaring public deficits and sovereign debt . Enterprises in developed economies now cutting
jobs , owing to reduced consumer demand , which has led to overstocking unsold products
and uncertainty about future demand . Layoffs weaken even more the demand , because
they restrict labor income and increases inequality. As the wage costs of a firm translates
into labor income and an increased demand for these workers , what seems rational for
individual companies is a total disaster for the economy .
Apart from the economic factors mentioned above, we will present social factors as well. At
the apex of the social problem are the crime and the health sector. Studies have shown that
the crime rate has doubled in the last year because of this phenomenon. The researchers
introduce two new issues, disparities in the growth of price indexes and in life expectancy
between the rich and the poor. "While the poor can do better, when corrected price indices
do much worse when considering the effects on their health." Cite evidence that between
1980 and 2000 , the life expectancy of below 10 per cent of employees increased only half
the rate of the top 10 percent. "This may be the most important single source of increasing
inequality in Greece , and not only combines unequal access to healthcare services and
insurance, but also in differences in personal habits and the environment related to education
and income . We could not ignore the psychological factor of the negative inequality. The
society has been influenced to a degree that led to the impasse of several suicides. According
to studies conducted, Greece holds the first places mortality by psychological factors. Apart
from that though, people trying everyday to find a solution, possessed by greater stress
which leads them to depression.
Chart 1 shows the evolution of economic inequality in Greece as expressed by the index in
quintiles of income distribution (S80/S20) and index unequal income distribution (coefficient
Gini). The index in quintiles of income distribution (S80/S20) amounted to 2012 reference
period income in 2011 to 6.6 , the share of income of the richest 20 % of the population was
6.6 times higher than the share of the poorest 20 % population . We observe that compared
to 2008 , year when the crisis hit , inequality has increased significantly.
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In addition to the index of income distribution in quintiles , depicted in Figure 1 and the Gini
coefficient that measures inequality in income distribution . The Gini coefficient ranged in
2012 34.3 % , the difference in income any two individuals in the population differ by 34.3 %
of the median income . As we both indicators record the same procedure confirming the
widening income Inequality in Greece after the crisis.
At European level, after Greece Spain shows the highest degree of income inequality ( Figure
2 ) . It is characteristic that the countries of the region which received the biggest blow of
the Great Depression had the highest levels of unequal distribution, in contrast to the
central countries which present a different picture.
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 In conclusion such a scale redistribution of wealth and income effect in further
reducing the tendency of consumption and falling output conditions of the crisis.
Additionally affects social mobility in shaping the social capital and the management
of political power. These conditions predict an even greater inequalities of income
and wealth in the near future . The main purpose of our work was to analyze the
global crisis and the Greek as well as income inequality during this period. Based on
the research we have done we have come to consider it the main problem. It also
mentions the negative effects of income inequality affecting the economic and social
situation in Greece. These are obvious in our daily life day by day more and more.
Did the bulk of unequal distribution of income and wealth in our country we should
attribute a significant part of the difficulty out of the crisis?
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APPENDIX

CAPITAL NEWS
 WIKIPEDIA
 FINANCIAL TIMES
 NEW YORK TIMES
 TO VHMA
 TO ETHNOS
 NEWS 247
 EURO2DAY.GR
 WALL STREET JOURNAL
 WORLD ECONOMIC FORUM
 EUROPA.EU
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