Germany's post-2000 stagnation in the European context - a lesson in macroeconomic mismanagement
In the present paper we question the mainstream diagnosis of Germany’s post-2000 stagnation as well as the prescribed remedies. We show that the ‘institutional sclerosis’ view of Germany’s stagnation is unfounded and that therefore the political measures proposed and actually taken are misguided. Instead, we claim that macroeconomic mismanagement explains the German absolute and relative stagnation compared with the Euro area as a whole and with the USA. If the problem of macroeconomic mismanagement is not addressed and solved, irrespective of occasional cyclical upswings, we predict a continuing stagnation tendency for the German economy. And we argue that this is not only a German problem, but a matter of European concern, because the macroeconomic policies which have caused the German constellation will have major negative feedback effects on the other Euro area countries in the near future.
|Date of creation:||Mar 2006|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +49 211 7778 234
Fax: +49 211 7778 4234
Web page: http://www.imk-boeckler.de
More information through EDIRC
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.:
- Hein, Eckhard & Truger, Achim, 2005. "European Monetary Union: nominal convergence, real divergence and slow growth?," Structural Change and Economic Dynamics, Elsevier, vol. 16(1), pages 7-33, March.
- Olivier J. Blanchard & Lawrence H. Summers, 1986.
"Hysteresis in Unemployment,"
NBER Working Papers
2035, National Bureau of Economic Research, Inc.
- Stephen G. Cecchetti, 1995.
"Distinguishing theories of the monetary transmission mechanism,"
Federal Reserve Bank of St. Louis, issue May, pages 83-97.
- Stephen G. Cecchetti, 1995. "Distinguishing theories of the monetary transmission mechanism," Review, Federal Reserve Bank of St. Louis, issue May, pages 83-97.
- Eckhard Hein, 2006.
"Wage Bargaining and Monetary Policy in a Kaleckian Monetary Distribution and Growth Model: Trying to Make Sense of the NAIRU,"
European Journal of Economics and Economic Policies: Intervention,
Edward Elgar, vol. 3(2), pages 305-329.
- Eckhard Hein, 2005. "Wage bargaining and monetary policy in a Kaleckian monetary distribution and growth model: trying to make sense of the NAIRU," IMK Working Paper 08-2005, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
- Laurence Ball, 1999. "Aggregate demand and Long-Run Unemployment," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 30(2), pages 189-252.
- Philip Arestis & Malcolm Sawyer, 2003.
"Reinventing Fiscal Policy,"
General Economics and Teaching
- Andrew Glyn, 2003.
"Labor Market Institutions and Unemployment: A Critical Assessment of the Cross-Country Evidence,"
Economics Series Working Papers
168, University of Oxford, Department of Economics.
- Dean Baker & Andrew Glyn & David Howell & John Schmitt, 2002. "Labor Market Institutions and Unemployment: A Critical Assessment of the Cross-Country Evidence," SCEPA working paper series. SCEPA's main areas of research are macroeconomic policy, inequality and poverty, and globalization. 2002-17, Schwartz Center for Economic Policy Analysis (SCEPA), The New School.
- Ben S. Bernanke & Mark Gertler, 1995.
"Inside the Black Box: The Credit Channel of Monetary Policy Transmission,"
NBER Working Papers
5146, National Bureau of Economic Research, Inc.
- Ben S. Bernanke & Mark Gertler, 1995. "Inside the Black Box: The Credit Channel of Monetary Policy Transmission," Journal of Economic Perspectives, American Economic Association, vol. 9(4), pages 27-48, Fall.
- Bernanke, Ben & Gertler, Mark, 1995. "Inside the Black Box: The Credit Channel of Monetary Policy Transmission," Working Papers 95-15, C.V. Starr Center for Applied Economics, New York University.
- Robert Solow, 2000. "Unemployment in the United States and in Europe - A Contrast and the Reasons," CESifo Working Paper Series 231, CESifo Group Munich.
- Eckhard Hein & Achim Truger, 2005. "A Different View of Germany's Stagnation," Challenge, M.E. Sharpe, Inc., vol. 48(6), pages 64-94, November.
- Philip Arestis & Malcolm Sawyer, 2005.
"Aggregate demand, conflict and capacity in the inflationary process,"
Cambridge Journal of Economics,
Oxford University Press, vol. 29(6), pages 959-974, November.
- Philip Arestis & Malcolm Sawyer, 2003. "Aggregate Demand, Conflict, and Capacity in the Inflationary Process," Economics Working Paper Archive wp_391, Levy Economics Institute.
- Engelbert Stockhammer, 2004.
"Is there an equilibrium rate of unemployment in the long run?,"
Review of Political Economy,
Taylor & Francis Journals, vol. 16(1), pages 59-77.
- Engelbert Stockhammer, 2000. "Is There an Equilibrium Rate of Unemployment in the Long Run?," Working Papers geewp10, Vienna University of Economics and Business Research Group: Growth and Employment in Europe: Sustainability and Competitiveness.
- Arestis, Philip, 1996. "Post-Keynesian Economics: Towards Coherence," Cambridge Journal of Economics, Oxford University Press, vol. 20(1), pages 111-35, January.
- Joerg Bibow, 2006. "Inflation Persistence and Tax-Push Inflation in Germany and in the Euro Area: A Symptom of Macroeconomic Mismanagement?," IMK Studies 01-2006, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
- Taylor, John B., 1993. "Discretion versus policy rules in practice," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 39(1), pages 195-214, December.
- Eckhard Hein & Achim Truger, 2005.
"What ever happened to Germany? Is the decline of the former European key currency country caused by structural sclerosis or by macroeconomic mismanagement?,"
- Eckhard Hein & Achim Truger, 2005. "What ever happened to Germany? Is the decline of the former european key currency country caused by structural sclerosis or by macroeconomic mismanagement?," International Review of Applied Economics, Taylor & Francis Journals, vol. 19(1), pages 3-28.
- Horst Siebert, 1997. "Labor Market Rigidities: At the Root of Unemployment in Europe," Journal of Economic Perspectives, American Economic Association, vol. 11(3), pages 37-54, Summer.
- Jorg Bibow, 2005. "Europe's Quest for Monetary Stability: Central Banking Gone Astray," Economics Working Paper Archive wp_428, Levy Economics Institute.
- Allsopp, Christopher & Vines, David, 1998. "The Assessment: Macroeconomic Policy after EMU," Oxford Review of Economic Policy, Oxford University Press, vol. 14(3), pages 1-23, Autumn.
- Bhaduri, Amit & Marglin, Stephen, 1990. "Unemployment and the Real Wage: The Economic Basis for Contesting Political Ideologies," Cambridge Journal of Economics, Oxford University Press, vol. 14(4), pages 375-93, December.
- Dimitri B. Papadimitriou & Anwar M. Shaikh & Claudio H. Dos Santos & Gennaro Zezza, 2005. "How Fragile is the U.S. Economy?," Economics Strategic Analysis Archive sa_mar_05, Levy Economics Institute.
- Dimitri B. Papadimitriou & Edward Chilcote & Gennaro Zezza, 2006. "Are Housing Prices, Household Debt, and Growth Sustainable?," Economics Strategic Analysis Archive sa_jan_06, Levy Economics Institute.
When requesting a correction, please mention this item's handle: RePEc:imk:wpaper:03-2006. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sabine Nemitz)
If references are entirely missing, you can add them using this form.