EconStor >
Bard College, Annandale-on-Hudson (NY) >
Levy Economics Institute of Bard College >
Working Papers, Levy Economics Institute of Bard College >

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10419/31551
  
Title:On the burden of German unification: the economic consequences of Messrs. Waigel and Tietmeyer PDF Logo
Authors:Bibow, Jörg
Issue Date:2001
Series/Report no.:Working papers // The Levy Economics Institute 328
Abstract:This paper investigates the causes of western Germany's remarkably poor performance since 1992. The paper challenges the view that the poor record of the nineties, particularly the marked deterioration in public finances since unification, might be largely attributable to unification. Instead, the analysis highlights the role of ill-timed and overly ambitious fiscal consolidation in conjunction with tight monetary policies of an exceptional length and degree. The issue of fiscal sustainability and Germany's fiscal and monetary policies are assessed both in the light of economic theory and in comparison to the best practices of other more successful countries. The analysis concludes that Germany's dismal record of the nineties must not be seen as a direct and apparently inevitable result of unification. Rather, the record arose as a perfectly unnecessary consequence of unsound macro demand policies conducted under the Bundesbank's dictate in response to it, policies that caused the severe and protracted de-stabilization of western Germany in the first place.
Document Type:Working Paper
Appears in Collections:Working Papers, Levy Economics Institute of Bard College

Files in This Item:
File Description SizeFormat
503898406.pdf1.71 MBAdobe PDF
No. of Downloads: Counter Stats
Download bibliographical data as: BibTeX
Share on:http://hdl.handle.net/10419/31551

Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.