Keynesian and monetarist views on the German unemployment problem: theory and evidence

Jan Gottschalk

No 1096, Kiel Working Papers from Kiel Institute for the World Economy

Abstract: Persistently high unemployment rates in Germany have led to a long-running controversy on the causes of the unemployment problem. This paper aims to re­view the contribution of Keynesian and monetarist theories to this controversy and explores empirically their implications for the explanation of high un­em­ploy­ment in Germany using a structural vector regression approach. In addition, this paper discusses the so-called wage gap which plays an important role in the debate whether the German unemployment problem is a real wage problem. Even though this paper cannot hope to settle the unemployment controversy, it nevertheless shows why a consensus has remained elusive.

Keywords: Unemployment; Phillips Curve; Structural Vector Autoregressions (search for similar items in EconPapers)
JEL-codes: B22 C32 E24 (search for similar items in EconPapers)
Date: 2002
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwkwp:1096

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