Ifo Economic Policy series – serie

Redesigning the Welfare State argues that the current high level of unemployment in Germany not only creates a major challenge for the German welfare state, but is to a good extent caused by the way the country's welfare system is designed. The authors review the public debate on labour market reforms, which has been ongoing since 2002, and discuss the first set of reforms that have been enacted since then. As the reforms carried out so far fall short of what is actually needed to increase employment and economic growth in the Eurozone's largest economy, the authors introduce a proposal for a more fundamental redesign of the German welfare state. With comparative discussions of important elements of recent labour market reforms in the US, the UK and the rest of Europe, this book will appeal to all labour market researchers, and to those with an interest in applied work and policy advising in Germany. It will also appeal to decision makers and experts at international organisations and think tanks with a specialisation on Europe and Germany.

In the 1990s, labour productivity growth accelerated in the United States, yet slowed down in other industrialised countries, reversing a three decade long tendency of convergence. The book explores this phenomenon. It first identifies the methodological and statistical problems involved in measuring productivity and making cross-country comparisons in this area. Then the role of factor accumulation for the diverging trends across the OECD world, with a particular focus on the dispersion of information and communication technology (ICT), is reviewed. In-depth studies of single countries provide further insights regarding growth trends in the United States, Japan, Germany, and France. Finally, empirical investigations regarding the determinants of productivity growth at an international level complement the analyses. The results stress that public infrastructure and education, employment rates and working hours, and ICT spending play an important role in explaining the existing differences in levels and changes of productivity. This comprehensive book, on recent research regarding international gaps in productivity growth, will be of great interest to policy advisors and academics, political decision-makers and students of economics, business administration, international business and international policy.

Theo S. Eicher and Thomas Strobel present an industry-level account of the recent changes in German productivity growth and compare the trends to Europe and the US. The specific focus is on how differential investments in information and communication technologies (ICT) affected the economic performance of these economies.Not all industrialized countries shared the economic fortunes that ICT presented to the US economy. While the US experienced successive accelerations in its trend growth in 1995 and again in 2000, Germany experienced dual reductions in labor productivity growth. Some European economies fared better and others even worse than Germany. Since productivity is the ultimate determinant of living standards, the authors examine the sources of these productivity differentials. They also present a new German growth accounting database that utilizes unique ICT investment data, sourced directly from the industries, to place their findings into an international context.This book is targeted at economists and policymakers alike, and is designed to provide clear guidance for those interested in industrial policy and statistical account methods.