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Lettre Mensuelle de Conjuncture

2005

Roland Döhrn

Pourquoi l'Allemagne a-t-elle une croissance si faible?

Germany has not a business cycle but a growth problem

Since the autumn of 2004, forecasts for the German economy have been revised downward gradually. This situation sheds once again light on the main problem of the German economy: Internal demand is such weak that external shock will press down growth close to stagnation. A growth accounting also offers another insight: Key to the unfavourable growth performance of Germany is that labour input had a negative contribution to growth between 1991 and 2004. At the same time growth of total factor productivity (TFP) fell back. These observations should set the agenda for economic policy in Germany: the government has already spotted the labour market. However, driving force of employment growth is a momentous rise of number of so called Minijobs. Hence, no real success of the new labour market policy can be seen.

Döhrn, R. (2005), Pourquoi l'Allemagne a-t-elle une croissance si faible?: Germany has not a business cycle but a growth problem. Lettre Mensuelle de Conjuncture, 480, 19