Many of the urgent problems of Germanys economy trace back to its poor growth performance in the recent decade. The current reduced growth path intensifies already existing structural problems on job markets, in the social security system and the public finances.The relevance of the long-term growth path is not adequately taken into account in public debates. Growth is discussed primarily in terms of business cycle phenomena. Therefore policy measures are judged on short-term, cyclical consequences while the impact of these measures on the long-run growth path is rarely considered.This short-term perspective is favoured by the fact that applied economic research of empirical growth analysis is mostly practised as business cycle analysis. Short-term economic forecasts and indicators are published in a large number by research institutes, banks and international organisations and enjoy wide press cover. This in turn aids to the short-term perspective of economic policy.The ZEW-Growth Monitor (GM) is to represent a counterweight to the prevailing short-term perspective of growth analysis. Contrary to existing business cycle indicators and forecasts the GM will be devoted to long-term growth analysis: The GM is to provide a measure of potential growth of a country. Therefore, the evaluation of economic policies based on the GM might differ considerably from the evaluation of business cycle analysis in many cases. The GM will contribute to a long-term perspective in economic reporting and thus to a farsighted orientation of economic policy.
Discussion and Working Papers
Kappler, Marcus (2004), Determination of Potential Growth Using Panel Techniques, ZEW Discussion Paper No. 04-69, Mannheim. Download
Böhringer Ilsfeld Stiftung, Essen, DE
01.01.2004 - 31.12.2004