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

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Author Info
Horst Siebert
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: http://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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Publisher 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
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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

Find related papers by JEL classification:
H - Public Economics
J - Labor and Demographic Economics
K - Law and Economics
O - Economic Development, Technological Change, and Growth
P - Economic Systems

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