The concept of potential output plays an important role in economic analysis as well as in economic policy discussions. Defined as the productive capacity that would be feasible under full utilization of all production factors (capital stock and labour input), it is a central reference variable in economic theories, starting from which the current situation of the economy is analyzed. Also in empirical economic research, potential output is a key reference variable in the analysis of the business cycle, for instance. For economic policy the potential output is of importance for separating structural problems from business cycle phenomena, for medium-term budget planning and especially for providing a variable of orientation for monetary policy. The aim of the present study is to make the concept of potential output and its underlying explicit and implicit economic and system-theoretical assumptions transparent, to critically analyze the prevailing projection methods and to compile proposals for innovative, forward-looking projection procedures. The working program consists of two main parts each with further subdivided sections. In the first project part, the concept of potential output is analyzed theoretically in view of the historical origins. Starting from an analysis of economic conditions and prevailing theories at the time of origin of the concept of potential output, the concept is analyzed from a dogma-historical perspective and criticized epistemologically from a system-theoretical viewpoint. In the second, empirical part, the most prominent methods for identifying potential output and the causes of the relative decline of the potential growth in Germany in comparison to other industrial countries during the last years are examined. Finally, alternative methods of forward-looking assessment of the evaluation of potential output are to be discussed.