Das deutsche Rätsel
AbstractThe article advances the hypothesis that Germany is unable to increase its gains from trade despite increasing trading volumes. High and rigid German wages argely result from the minimum wage constraint imposed by a welfare state that offers generous replacement incomes. Confronted by low-wage competition from post-communist countries, Germany overspecializes in capital intensive goods, which creates a pathological export boom in terms of added value produced in exports. In addition, the country overspecializes in downstream activities, which implies that export quantities grow faster than value added. The reasons which induce extremely high exports are the same as those which cause unemployment to rise and the economy to stagnate.
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Bibliographic InfoPaper provided by University of Munich, Department of Economics in its series Munich Reprints in Economics with number 950.
Date of creation: 2006
Date of revision:
Publication status: Published in Perspektiven der Wirtschaftspolitik 7(2006): pp. 1-18
Find related papers by JEL classification:
- F10 - International Economics - - Trade - - - General
- F20 - International Economics - - International Factor Movements and International Business - - - General
- I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Hans-Werner Sinn & Christian Holzner & Wolfgang Meister & Wolfgang Ochel & Martin Werding, 2002. "Aktivierende Sozialhilfe - Ein Weg zu mehr Beschäftigung und Wachstum," Ifo Schnelldienst, Ifo Institute for Economic Research at the University of Munich, vol. 55(09), pages 03-52, 05.
- Brecher, Richard A, 1974. "Minimum Wage Rates and the Pure Theory of International Trade," The Quarterly Journal of Economics, MIT Press, vol. 88(1), pages 98-116, February.
- Bernhard Herz & Marco Wagner, 2008. "Exportweltmeister Deutschland - ein Sommermärchen?," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 9(4), pages 446-464, November.
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