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Unemployment in Germany: Reasons and Remedies

  • Norbert Berthold
  • Rainer Fehn
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    This paper discusses the reasons for the dismal labor market performance of Germany over the last three decades along with potential remedies. It argues that labor market rigidities along with a generous welfare state in conjunction with certain changes in the economic environment are important in explaining this development but cannot solely account for it. Barriers to entrepreneurship, to setting up new firms and to innovations which are prevalent on goods and capital markets also play an important role in explaining the lackluster German economic performance of which rising unemployment is only one part. Comprehensive institutional reforms are therefore called for.

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    File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2003/wp-cesifo-2003-02/cesifo_wp871.pdf
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    Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 871.

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    Date of creation: 2003
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    Handle: RePEc:ces:ceswps:_871
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