IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

Structural Change and the Current Account: The Case of Germany

Listed author(s):
  • Fabrizio Coricelli

    (Paris School of Economics-Université Paris 1)

  • Andreas Wörgötter


Using empirical evidence from panel analysis of current account dynamics and of bilateral trade balances, the paper argues that the large German current account surplus during the 2000s can be explained by an increasing gap between productivity growth in manufacturing vis-à-vis services. Such a gap is due not only to improvements in the manufacturing sector but also to a significant slowdown of productivity growth in services. Therefore, despite the success in export markets, the German surplus may signal long-run weaknesses associated with constraints on service sector productivity growth and the inability of productivity growth in manufacturing to create positive spill-over effects on services. Persistence of barriers to liberalisation in services as well as the dominant type of technological progress in manufacturing, based on improving the efficiency of existing products, may partly explain these phenomena. A key factor behind these sectoral differences is the education system, which relies on highly specialised vocational schools, generating high returns for on the job training and creating incentives for efficiency gains in existing products and sectors. The paper concludes that there is room for comprehensive structural policies consistent with an equilibrium reduction in the current account surplus, accompanied by higher and more balanced growth. Réformes structurelles et balance courante : le cas de l'Allemagne À partir des données factuelles issues de l’analyse des graphiques de l’évolution de la balance courante et de la balance des échanges bilatéraux, cette étude montre que l’excédent de la balance courante allemande provient de l’écart grandissant entre la croissance de la productivité dans le secteur manufacturier et dans celui des services. Ce décalage s’explique, d’une part, par les améliorations apportées à l’industrie manufacturière, et, d’autre part, par le ralentissement marqué de la hausse de la productivité dans les services. En ce sens, malgré les performances de l’Allemagne en matière d’exportation, l’excédent de sa balance courante peut présager de certaines faiblesses sur le long terme ; le secteur des services pâtit d’une productivité bridée et ne bénéficie pas non plus de la hausse de la productivité du secteur manufacturier. L’explication de ce phénomène réside en partie dans la persistance de barrières à la libéralisation des services. En outre, le modèle de progrès technologique dominant dans l’industrie manufacturière allemande, axé sur l’amélioration de l’efficacité des produits existants, ne génère pas d’effet multiplicateur sur le secteur des services, contrairement à ce qui a été observé aux États-Unis. L’origine de ces disparités sectorielles est notamment à rechercher du côté d’un système éducatif qui repose sur des écoles professionnelles très spécialisées, très efficaces pour ce qui concerne la formation pratique, incitant à développer des gains d’efficacité pour les produits et les secteurs existants. La segmentation de l’éducation fait écho à la sectorisation de la réglementation ; elle freine l’adoption des innovations radicales et des nouveaux produits, qui relève d’une éducation plus généraliste, et crée de faibles barrières à l’entrée sur un marché intérieur caractérisé par son ampleur. L’étude conclut qu’il est possible de mettre en place des politiques structurelles globales compatibles avec une réduction de l’excédent de la balance courante, s’accompagnant d’une croissance plus forte et plus équilibrée.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: no

Paper provided by OECD Publishing in its series OECD Economics Department Working Papers with number 940.

in new window

Date of creation: 03 Feb 2012
Handle: RePEc:oec:ecoaaa:940-en
Contact details of provider: Postal:
2 rue Andre Pascal, 75775 Paris Cedex 16

Phone: 33-(0)-1-45 24 82 00
Fax: 33-(0)-1-45 24 85 00
Web page:

More information through EDIRC

References listed on IDEAS
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.:

in new window

  1. Angela Cheptea & Lionel Fontagné & Soledad Zignago, 2014. "European export performance," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 150(1), pages 25-58, February.
  2. Enrico Moretti, 2010. "Local Multipliers," American Economic Review, American Economic Association, vol. 100(2), pages 373-377, May.
  3. Rebekka Christopoulou & Philip Vermeulen, 2012. "Markups in the Euro area and the US over the period 1981–2004: a comparison of 50 sectors," Empirical Economics, Springer, vol. 42(1), pages 53-77, February.
  4. Maurice Obstfeld & Kenneth S. Rogoff, 1996. "Foundations of International Macroeconomics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262150476, January.
  5. Niels Bosma & Erik Stam & Veronique Schutjens, 2011. "Creative destruction and regional productivity growth: evidence from the Dutch manufacturing and services industries," Small Business Economics, Springer, vol. 36(4), pages 401-418, May.
  6. Jonathan D. Ostry & Carmen M. Reinhart, 1992. "Private Saving and Terms of Trade Shocks: Evidence from Developing Countries," IMF Staff Papers, Palgrave Macmillan, vol. 39(3), pages 495-517, September.
  7. Clovis Kerdrain & Isabell Koske & Isabelle Wanner, 2010. "The Impact of Structural Policies on Saving, Investment and Current Accounts," OECD Economics Department Working Papers 815, OECD Publishing.
  8. Calista Cheung & Davide Furceri & Elena Rusticelli, 2013. "Structural and Cyclical Factors behind Current Account Balances," Review of International Economics, Wiley Blackwell, vol. 21(5), pages 923-944, November.
  9. Alessandro Rebucci & Nicoletta Batini & Pietro Cova & Massimiliano Pisani, 2009. "Global Imbalances; The Role of Non-Tradabletotal Factor Productivity in Advanced Economies," IMF Working Papers 09/63, International Monetary Fund.
  10. Jens Matthias Arnold & Andreas Worgotter, 2011. "Structural reforms and the benefits of the enlarged EU internal market: still much to be gained," Applied Economics Letters, Taylor & Francis Journals, vol. 18(13), pages 1231-1235.
  11. Hans-Werner Sinn, 2006. "The Pathological Export Boom and the Bazaar Effect: How to Solve the German Puzzle," The World Economy, Wiley Blackwell, vol. 29(9), pages 1157-1175, 09.
  12. Olivier Blanchard, 2007. "Current Account Deficits in Rich Countries," IMF Staff Papers, Palgrave Macmillan, vol. 54(2), pages 191-219, June.
  13. Jean-Marc Fournier & Isabell Koske, 2010. "A Simple Model of the Relationship Between Productivity, Saving and the Current Account," OECD Economics Department Working Papers 816, OECD Publishing.
  14. Suparna Chakraborty & Robert Dekle, 2009. "Can International Productivity Differences Alone Account for the US Current Account Deficits?," Review of International Economics, Wiley Blackwell, vol. 17(4), pages 689-715, September.
  15. Dierk Herzer, 2012. "Outward FDI, Total Factor Productivity and Domestic Output: Evidence from Germany," International Economic Journal, Taylor & Francis Journals, vol. 26(1), pages 155-174, October.
  16. Isabell Koske & Andreas Wörgötter, 2010. "Germany's Growth Potential, Structural Reforms and Global Imbalances," OECD Economics Department Working Papers 780, OECD Publishing.
  17. Naude Wim, 2011. "Global Finance after the Crisis: Reform Imperatives and Vested Interests," Global Economy Journal, De Gruyter, vol. 11(2), pages 1-22, July.
  18. Robert Dekle & Jonathan Eaton & Samuel Kortum, 2008. "Global Rebalancing with Gravity: Measuring the Burden of Adjustment," IMF Staff Papers, Palgrave Macmillan, vol. 55(3), pages 511-540, July.
  19. Felix Hüfner & Isabell Koske, 2010. "Explaining Household Saving Rates in G7 Countries: Implications for Germany," OECD Economics Department Working Papers 754, OECD Publishing.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:oec:ecoaaa:940-en. 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: ()

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.