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The Economic Integration of Germany's New Länder

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  • Eckhard Wurzel

Abstract

The economic integration of the eastern German states has progressed rapidly in many respects. The infrastructure has been rapidly built up and modernised. A strong trend to modernise the business capital stock has been established, aided by financial assistance from the west. Already at the beginning of the 1990s the elaborate western German social security system had been extended to the new states. Incomes of both the employed and the non-employed, in particular retirees, have risen fast, and have approached west German levels. There has also been a high degree of structural change, as witnessed by high growth rates in manufacturing, increasing export shares, the rapid expansion of the service sector and the down-sizing of the construction sector after very high -- and largely policy-induced -- growth rates in the first half of the 1990s. However, in the second half of the 1990s economic growth in the east decelerated, and income convergence has stalled and employment stagnated ... L’intégration économique des Länder d’Allemagne orientale a progressé rapidement dans des domaines essentiels. Les infrastructures ont été développées et modernisées rapidement. Grâce à l’aide financière de l’Ouest, un puissant processus de modernisation du parc d’équipements industriels et commerciaux s’est instauré. Dès le début des années 90, le système élaboré de sécurité sociale de l’Allemagne occidentale a été étendu aux nouveaux Länder. Les revenus des actifs et des inactifs, en particulier les retraités, ont rapidement augmenté et se sont largement rapprochés des niveaux observés en Allemagne occidentale. On constate en outre jusqu’à présent un profond changement structurel, dont témoignent la forte croissance dans le secteur manufacturier, l’augmentation des parts de marché à l’exportation, la vive expansion des services et la contraction très marquée dans la construction, qui avait connu durant la première moitié des années 90 des taux de croissance très rapides, induits ...

Suggested Citation

  • Eckhard Wurzel, 2001. "The Economic Integration of Germany's New Länder," OECD Economics Department Working Papers 307, OECD Publishing.
  • Handle: RePEc:oec:ecoaaa:307-en
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    File URL: http://dx.doi.org/10.1787/777416102672
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    Citations

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    Cited by:

    1. Ivan Angelov, 2004. "Accelerated Economic Development – Theory and Practice," Economic Thought journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 1, pages 3-33.
    2. Eric Rugraff, 2013. "La Commission européenne est-elle responsable des excédents commerciaux allemands ?," Bulletin de l'Observatoire des politiques économiques en Europe, Observatoire des Politiques Économiques en Europe (OPEE), vol. 29(1), pages 25-28, December.
    3. Kuehn, Zoe, 2012. "Migration, Wages, and Parental Background: Obstacles to Entrepreneurship and Growth in East Germany," MPRA Paper 49250, University Library of Munich, Germany.
    4. repec:ulp:buopee:v:29:y:2013:m:12:i:5 is not listed on IDEAS
    5. Karl Aiginger, 2003. "Insufficient investment into future growth: the forgotten cause of low growth in Germany," Economics working papers 2003-14, Department of Economics, Johannes Kepler University Linz, Austria.
    6. Page, William, 2003. "Germany's Mezzogiorno revisited: Institutions, fiscal transfers and regional convergence," Research Notes 9, Deutsche Bank Research.
    7. Juan Carlos Martinez Oliva, 2009. "Riunificazione intertedesca e politiche per la convergenza," Mo.Fi.R. Working Papers 14, Money and Finance Research group (Mo.Fi.R.) - Univ. Politecnica Marche - Dept. Economic and Social Sciences.
    8. Conny Wunsch, 2005. "Labour Market Policy in Germany: Institutions, Instruments and Reforms since Unification," University of St. Gallen Department of Economics working paper series 2005 2005-06, Department of Economics, University of St. Gallen.

    More about this item

    Keywords

    active labour market measures; dépenses publiques; développement économique; economic development; economic integration; fiscal policy; government expenditure; intergovernmental relations; intégration économique; labour mobility; mesures actives du marché du travail; mobilité du travail; niveau du salaire; politique fiscale; relation gouvernementale; transfers; transferts; transition economies; wage level; économie en transition; émigration;

    JEL classification:

    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O23 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Fiscal and Monetary Policy in Development
    • P21 - Economic Systems - - Socialist Systems and Transition Economies - - - Planning, Coordination, and Reform

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