Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/105879
Authors: 
Hein, Eckhard
Truger, Achim
Year of Publication: 
2006
Series/Report no.: 
IMK Working Paper 3/2006
Abstract: 
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.
Subjects: 
Macroeconomic policy
structural reforms
unemployment
growth
inflation
JEL: 
E58
E61
E62
E63
E64
E65
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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