Essays on Success of the Government and the Central Bank of Germany in Running Economy over the Last Two Years Case Study

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The paper "Success of the Government and the Central Bank of Germany in Running Economy over the Last Two Years" is a great example of a micro and macroeconomic case study.   Germany is an open economy where social protection and the state play a dominant role. The economic decisions made in Germany are based on the need to compete globally which has been a fundamental economic law since the Second World War (Storm and Naastepad, 2015). Despite this, there are protectionist measures in some areas of Germany economy. This is especially the protection of individuals due to the provision of employment.

The Germany economic growth picked up in 2014 after a period of two years of weak growth. Germany was able to register a growth of 1.6% in 2015. The government has been expecting economic growth of 1.8% in 2016 (Destatis, 2015). The government has a major role in the Germany economy. The central bank also has a great impact on the Germany economy. Germany's central bank (Bundesbank) is a politically independent body whose mandate is focused on price stability and targeting (Berggren, Daunfeldt, and Hellströ m, 2014).

Bundesbank has been able to maintain transparency which has also supported economic growth. This paper looks at how successful has the government and the Central Bank of Germany been in running the economy for the past 2 years. The paper also describes and evaluates the main macroeconomic policies used by the Government and Central Bank of Germany over the last two years. The success of the Government and the Central Bank of Germany in running economy over the last two years Unemployment Despite the difficult international economy, the Germany economy has been performing well.

The Germany economic growth has been able to match the potential output growth (Cantoni, Dittmar and Yuchtman, 2015). The country's unemployment levels have been falling compared to most of the countries in the eurozone (Engbom, Detragiache and Raei, 2015). The current development in Germany labour market has been boosted by low inflation (Kirkegaard, 2014). The government has made a lot of efforts in enhancing the labour market. In 2015, there were 43.5 million people in work which is an increase of 400,000 people than a year earlier (Destatis, 2015).

References

Berggren, N., Daunfeldt, S.O. and Hellström, J., 2014. Social trust and central-bank independence. European Journal of Political Economy, 34, pp.425-439.

Bodea, C. and Hicks, R., 2015. Price stability and central bank independence: Discipline, credibility, and democratic institutions. International Organization, 69(01), pp.35-61.

Cantoni, D., Dittmar, J. and Yuchtman, N., 2015. Reformation and reallocation: Human capital, employment, and economic growth in the german lands. Working Paper.

De Grauwe, P., 2016. Economics of monetary union. Oxford University Press.

Destatis, 2015, German economy, 4th Quarter 2015, Publication, Retrieved 20th march 2016 from, https://www.destatis.de/EN/Publications/Specialized/Nationalaccounts/GermanEconomy. pdf?__blob=publicationFile

Eichhorst, W., 2015. The unexpected appearance of a new German model. British Journal of Industrial Relations, 53(1), pp.49-69.

Engbom, N., Detragiache, M.E. and Raei, F., 2015. The German Labor Market Reforms and Post-Unemployment Earnings (No. 15-162). International Monetary Fund.

Hein, E. and Truger, A., 2014. Future fiscal and debt policies: Germany in the context of the European Monetary Union. In Fiscal and Debt Policies for the Future (pp. 76-115). Palgrave Macmillan UK.

Kirkegaard, J.F., 2014. Making Labor Market Reforms Work for Everyone: Lessons from Germany. Policy Brief, pp.14-1.

Milward, A.S., 2015. The German economy at war. Bloomsbury Publishing.

Moss, B. ed., 2016. Monetary Union in Crisis: The European Union as Neo-Liberal Construction. Springer.

Storm, S. and Naastepad, C.W.M., 2015. Crisis and recovery in the German economy: The real lessons. Structural Change and Economic Dynamics, 32, pp.11-24.

Ubide, A., 2014. Is the European Central Bank failing its price stability mandate? (No. PB14-5). Peterson Institute for International Economics.

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