Alemanha atrás da aparência

No. 39, September 22, 2013

Germany – Heading for Meltdown?

Oskar Kurer
Institute of Economics
University of Erlangen-Nuremberg

Abstract: Germany looks prosperous, yet it suffers from low productivity growth and fiscal imbalances. These weaknesses could escalate in the future as the population continues to age. Measures to cut some entitlements and limit budget deficits have been taken, but it is doubtful that they will be implemented. German politicians are known to ignore such regulations and voters who should punish fiscal irresponsibility are in the throes of a mentalité that denigrates business activities, competitive markets, economic change and innovation. German politicians and voters extol the virtues of political action, social control, economic regulation, redistribution, and a life unsullied by commerce. Short of a radical change in such attitudes, voters will continue to call for productivity-reducing economic policies and an unsustainable level of welfarism. In the absence of a conjunction of contingent events favoring reforms, Germany could follow the well-trodden path of Southern Europe that ends inevitably in a fiscal meltdown.
Mais