Germany's fiscal policy stance

Arbeitspapier

This paper analyzes Germany's fiscal policy position. Half of GDP passes through the hands of government, a high debt to GDP ratio limits the maneuvering, and the revenue sharing mechanism prevents a competitive federalism. Most importantly for the future, the federal finance minister has to pick up the deficits that the social security systems leave behind. Transfers from the public budget to the social security systems are large, and since 1998 the elasticity of transfers to nominal GDP is 4. This trend will intensify in an aging society. All these factors weaken the prospects for reform that Germany must undertake in its taxation and expenditure system in view of the changed international conditions.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Kiel Working Paper ; No. 1196

Classification and Topics

• Classification: Wirtschaft ; Health, Education, and Welfare: General ; Taxation, Subsidies, and Revenue: General ; General Aggregative Models: Neoclassical ; General Aggregative Models: Keynes; Keynesian; Post-Keynesian
• Subject: Fiscal Policy ; Subsidies ; German Unification ; Debt ; Revenue Sharing ; Social Policy ; Finanzpolitik ; Öffentliche Schulden ; Staatsquote ; Deutschland

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Siebert, Horst
• Event: Veröffentlichung
• (who): Kiel Institute for World Economics (IfW)
• (where): Kiel
• (when): 2004

Further information

• Handle: http://hdl.handle.net/10419/3151
• Last update: 10.03.2025, 11:41 AM CET