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MUCH of the rich world is fascinated by Germany. Despite being at the heart of sclerotic Europe, its GDP per head has risen by more than any other G7 country's over the past decade. Unemployment in the troubled euro zone is at its highest since the single currency's birth; in Germany it is at a record low. In most rich countries manufacturing exports have been hammered by foreign competition; in Germany they remain powerful drivers of growth. No wonder hard-pressed political leaders in France, Spain, Italy and Britain are talking wistfully of becoming more like Germany.
Germany's recent success has both new and old roots. Only a decade ago, still struggling with the costs of unification, it was a basket-case. It has since bounced back to show that a high-wage country can succeed in top-end manufacturing, not least by holding down unit labour costs. The Germans have long since repaired their public finances—the budget deficit is barely 1% of GDP, public spending as a share of GDP is well below the European average and German bond yields are at record lows. Thanks mainly to the Agenda 2010 reforms begun by the Social Democrat-led government of Gerhard Schröder in 2003, Germany has liberalised many of its labour-market rules, one reason for today's enviably low unemployment.
Yet Germany's cutting edge has an ancient blade. The country's Mittelstand clusters of firms, which often specialise in niche areas of manufacturing, developed in the late 19th century. Impressively resilient and versatile, they have benefited from rocketing demand for high-quality capital and consumer goods in emerging markets. Germany's corporatistMitbestimmung model, which gives workers a say in management, has made it easier both to push through structural reforms and to hold down wages. And the German system of apprenticeships and vocational training, divided into some 350 trades, has helped keep youth unemployment lower than elsewhere in Europe (see article).
The sincerest form of flattery
So what should Europe's weaker countries be trying to copy? The relaxation of labour-market rules, certainly. That is beginning to happen, though as Italy has been discovering (see article), liberalising labour markets is harder in tough economic times. Germany freed up its job market when demand was strong in the rest of Europe. There is also much to be said for emphasising vocational training instead of producing more and more graduates with often useless university degrees. But many of the things that work well in Germany—its corporatism, its business clusters, its manufacturing prowess—are part of a traditional culture that would be hard, if not impossible, to transplant from one country to another.
Nor should Germany's neighbours try to import the model wholesale. Its corporatist industrial relations, for instance, help companies hold wages down, but they can also be bad for shareholders. And while the country's manufacturing sector may be productive, its service sector is not; and services now account for some two-thirds of GDP. The financial industry is relatively unprofitable and has a record of investing in dodgy foreign assets (including rotten American mortgages). Germany's demographic outlook is lousy. Its native population is shrinking and ageing fast, and the country does not welcome immigrants.
Above all, the country's hair-shirt philosophy that favours austerity over growth, saving over spending, and foreign over domestic demand has often been damaging. It has held down Germans' living standards (despite faster growth, personal consumption has risen by less than in the rest of Europe over the past decade). And it has been catastrophic for the rest of the euro zone as Germany has acted, in effect, as a drag on demand. Investors who sold off Spanish and Italian bonds this week were worried as much about the effects of excessive austerity as about public-debt levels (see article). Germany's reliance on exports has led to huge current-account surpluses that have been matched by deficits elsewhere, a big contributor to the euro crisis.
German policymakers who urge only austerity and wage restraint on the rest of Europe forget that the goal of growth is to raise personal incomes (and spending), and that the real benefit from higher exports is to pay for more imports. The rest of Europe would do well to copy the best features of the German model. But Germany too should learn from its partners about the importance of raising and sustaining domestic demand. Then everybody would be better off.译言網



德国近期所取得的成功既取决于新的思路、也有来自历史的原因。十年前,德国还在疲于应对统一后留下的烂摊子。而如今它又恢复了活力,并证明高薪酬的国家高端制造业领域是能够取得成功的,特别是在通过降低单位劳动成本的境况下。德国在很早以前就对本国公共财政进行了修复——财政赤字仅占GDP的1%,其公共开支在GDP中所占比例也远低于欧洲平均水平,此外德国的债券收益率也保持在历史最低水平。这主要归功于由格哈德·施罗德(Gerhard Schröde)所领导的社会民主党政府在2003年所推行的名为“2010年议程”的改革。通过改革,德国多项劳动力市场规则得以放宽,这被视为德国能够实现目前令人羡慕的低失业率的原因之一。


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