Old Europe's social model: A reason of low growth? The case of Germany

Horst Siebert

No 1291, Kiel Working Papers from Kiel Institute for the World Economy (IfW Kiel)

Abstract: This paper discusses the goal conflict between social protection and economic growth as well as employment. Taking the German economy as an example for the large continental economies of Old Europe, it analyzes twenty mechanisms that affect the fundamentals of the economy negatively and imply low growth and high unemployment. An empirical index is constructed. In the period 1960-2005, an increase in the social protection index goes together with a decline in the GDP growth rate by 2.6 percentage points.

Keywords: Economic growth; Unemployment; Mechanisms for a poor dynamics; Old Europe; Erosion; Social protection (search for similar items in EconPapers)
JEL-codes: H J K O P (search for similar items in EconPapers)
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwkwp:1291

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