Working papers, Department of Economics, WU (Wirtschaftsuniversität Wien)
No 114:
Globalization and the effects of changes in functional income distribution on aggregate demand in Germany
Engelbert Stockhammer ()
, Eckhard Hein ()
and Lucas Grafl ()
Abstract: Germany has experienced a period of extreme nominal and
real wage moderation since the mid 1990s. Contrary to the expectations of
liberal economists this has failed to improve Germany’s mediocre economic
performance. However, Germany is now running substantial current account
surpluses. One possible explanation for Germany’s disappointing performance
is found in Kaleckian theory, which highlights that the domestic demand
effect of a decline in the wage share will typically be contractionary,
whereas net exports will increase (Blecker 1989). The size of the foreign
demand effect will critically depend on the degree of openness of the
economy. The paper aims at estimating the demand side of a Bhaduri-Marglin
(1990) –type model empirically for Germany. The paper builds on the
estimation strategy of Stockhammer, Onaran and Ederer (2007) and Hein and
Vogel (2008a, 2008b). The main contribution lies in a careful analysis of
the effects of globalization. Since Germany is a large open economy by now
it is a particularly interesting case study.
JEL-Codes: E12; E20; E22; E25; E61; (follow links to similar papers)
December 2007
PDF Document
Before downloading any of the electronic versions below
you should read our statement on
copyright.
Download GhostScript
for viewing Postscript files and the
Acrobat Reader for viewing and printing pdf files.
Downloadable files:
wu-wp114.pdf 
Download Statistics
Report other problems with accessing this service to Sune Karlsson ()
or Helena Lundin ().
Programing by
Design Joakim Ekebom
