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Keynesian and Monetarist Views on the German Unemployment Problem ; Theory and Evidence

  • Jan Gottschalk
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    Persistently high unemployment rates in Germany have led to a long-running controversy on the causes of the unemployment problem. This paper aims to re­view the contribution of Keynesian and monetarist theories to this controversy and explores empirically their implications for the explanation of high un­em­ploy­ment in Germany using a structural vector regression approach. In addition, this paper discusses the so-called wage gap which plays an important role in the debate whether the German unemployment problem is a real wage problem. Even though this paper cannot hope to settle the unemployment controversy, it nevertheless shows why a consensus has remained elusive.

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    File URL: https://www.ifw-members.ifw-kiel.de/publications/keynesian-and-monetarist-views-on-the-german-unemployment-problem-theory-and-evidence/kap1096.pdf
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    Paper provided by Kiel Institute for the World Economy in its series Kiel Working Papers with number 1096.

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    Length: 150 pages
    Date of creation: Jan 2002
    Date of revision:
    Handle: RePEc:kie:kieliw:1096
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