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Analysis of the Declining Trend in Germany’s Potential Growth Performance

  • Sebastian Hauptmeister
  • Friedrich Heinemann
  • Marcus Kappler
  • Margit Kraus
  • Andreas Schrimpf
  • Hans-Michae Trautwein
  • Qingwei Wang
Chapter
Part of the ZEW Economic Studies book series (ZEW, volume 42)

Germany’s relatively weak growth performance since the mid-1990s in comparison with other countries has given rise to policy and academic debate in recent years focusing on the possible reasons for this decline in economic dynamism. Figure 17 outlines the decline in real economic growth in Germany since the mid- 1980s. A substantial growth gap has also opened up with respect to the euro area and OECD countries since the middle of the 1990s. This ongoing decline in real economic growth in Germany cannot be explained by a cyclically determined under-utilisation of production capacities alone. On the contrary, adjusting the underlying growth data for business cycle effects reveals a declining trend in potential growth for the German economy in recent decades. This development is illustrated in Figure 18.

Keywords

Total Factor Productivity Labour Force Participation Fiscal Policy Euro Area European Central Bank 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Physica-Verlag Heidelberg 2009

Authors and Affiliations

  • Sebastian Hauptmeister
    • 1
  • Friedrich Heinemann
    • 1
  • Marcus Kappler
    • 1
  • Margit Kraus
    • 1
  • Andreas Schrimpf
    • 1
  • Hans-Michae Trautwein
    • 1
  • Qingwei Wang
    • 1
  1. 1.Centre for European Economic Research(ZEW)Germany

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