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Old Europe’s Social Model – A Reason of Low Growth? The Case of Germany

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  • Horst Siebert
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    Abstract

    This paper discusses the goal conflict between social protection and economic growth as well as employment. Taking the German economy as an example for the large continental economies of Old Europe, it analyzes twenty mechanisms that affect the fundamentals of the economy negatively and imply low growth and high unemployment. An empirical index is constructed. In the period 1960-2005, an increase in the social protection index goes together with a decline in the GDP growth rate by 2.6 percentage points.

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    File URL: https://www.ifw-members.ifw-kiel.de/publications/old-europe-s-social-model-a-reason-of-low-growth-the-case-of-germany/kap1291.pdf
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    Bibliographic Info

    Paper provided by Kiel Institute for the World Economy in its series Kiel Working Papers with number 1291.

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    Length: 25 pages
    Date of creation: Sep 2006
    Date of revision:
    Handle: RePEc:kie:kieliw:1291

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    Related research

    Keywords: Social protection; Economic growth; Unemployment; Mechanisms for a poor dynamics; Old Europe; Erosion;

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