It looks like the Greek monopoly on feta cheese is simply not enough to keep their economy strong. The celebrated cradle of Western civilization and birthplace of reason and democracy, has now written a new page in the annals of political economy. Under pressure from the EU because of it’s budget deficit, the Greek government has come up with a rather...um... innovative way to bring it’s GDP on to a more even par with its budget deficit:

from Guardian Unlimited:

Athens has announced that its economy is 25% bigger than thought thanks, in part, to the round-the-clock duties of the country's prostitutes, who were known as hetairai in ancient times.

The Greek authorities are revising the country's gross domestic product (GDP) after deciding that the black market should be included in the figures.

Manolis Kontopyrakis, the head of the national statistics service, told Reuters: "The revised GDP will include some money from illegal activities, such as money from cigarette and drinks smuggling, prostitution and money laundering."

Greece's economic output was €180bn (£128bn) in 2005 and is expected to rise to €194bn this year. The black economy is estimated at up to €60bn, according to Reuters. (full story)

Bootlegging and prostitution revenue figures in the GDP? Let’s see if it measures up to what we know about GDP...

From the Biz/Ed Economics Glossary:

...(GDP) is a measure of National Income. It is the total value of all goods and services produced over a given time period (usually a year) excluding net property income from abroad. It can be measured either as the total of income, expenditure or output.

Hmm...I guess the bootlegging covers the "goods" end of things. And prostitution definitely involves "servicing" of one sort or another. But a proposal like this has to be based on some sort of intensive field research, doesn’t it? I wonder if Kontopyrakis paid for the research with his own money or if he used government funds in his study of price structures, exchange rates, and the like.

At any rate, the silver lining in Greece’s cloud of vice and profiteering might ultimately come with an even higher cost at the end of the day. Not only will Athens have to contend with some unwelcome scrutiny from the EU over their new GDP figures, they also will face the likelihood of losing money should their inflated GDP numbers ultimately be accepted by the EU.

from Financial Times (FT.com)

The country’s newfound wealth raised eyebrows in Brussels, because it means Greece will find it easier to bring its budget deficit below the European Union’s 3 per cent of GDP ceiling.

Having previously been found guilty of underestimating the size of its budget deficit, Greece’s new GDP calculation will be scrutinised by Eurostat, the EU statistics agency.

"Member states revise their figures regularly, but this is quite a significant revision and needs to be checked," said a spokeswoman for Joaquín Almunia, EU monetary affairs commissioner.

Mr Almunia’s aides admit they were surprised by Athens’ announcement, which was not discussed in advance with Brussels or other EU finance ministers. Typically, such upward GDP revisions are of between 1-2 per cent, although Greece and Italy have each previously made big revisions.

[...]

Among the snags of becoming so much richer, Greece will have to contribute more to the EU budget and could lose €470m ($597m, £318m) a year in EU funds earmarked for poor countries after a review in 2010. (full story)

Best of luck to the Greek government in this new wacky and sensational scheme.  It kind of gives new meaning to the phrase "fetishism of commodities," doesn't it? 

Efharisto -- once again -- to the superior intellect of Antonis, who is the honorary Minister of Cultural Affairs for greeklish.org.