OECD Economic Surveys: Germany 2012

Table of contents
Basic statistics of Germany, 2010
Executive summary
Assessment and recommendations
	Growth is slowing after an extraordinary rebound from the recession
		Figure 1. Economic performance of Germany
		Box 1. The German labour market miracle – lessons for other countries
		The short­term outlook has weakened, …
			Table 1. Short­term projections
		… is surrounded by considerable uncertainty, …
		… and imbalances remain
			Figure 2. Current account surplus and investment rates
		A stable banking system is essential for sustainable growth
			Figure 3. Capitalisation of European banking systems, 2010
		Growth spillovers from Germany to other countries…
			Table 2. Trade links of Germany within the euro area, 2010
		… are influenced by monetary policy and financial linkages
		The fiscal rule imposes a return to sustainable public balances…
		… and tax reform should aim at a more growth­friendly tax structure
			Table 3. Tax revenues by category
			Table 4. Tax wedge by family­type and wage level
	Structural reforms for stronger and more sustainable growth
		Potential growth is set to decline over the next decade…
			Figure 4. Potential growth and ageing effects
		… requiring reforms raising labour input…
			Table 5. Female labour input
			Figure 5. Employment of older workers and tertiary attainment
			Figure 6. Composition of migration to Germany and the education level of migrants
			Box 2. Recommendations for the labour market
		… and policies for raising productivity and better balanced growth…
			Table 6. Labour productivity compared to the OECD
		Turning the task of climate change mitigation into a new source of growth
			Box 3. Recommendations for improving resilience and trend growth
			Figure 7. Growth in GHG emissions 1990­2009, %
			Figure 8. Renewables and feed­in tariffs
			Figure 9. Government R&D spending on environment and energy
			Box 4. Recommendations for climate change mitigation and green growth policy
	Bibliography
	Annex A1. Progress in structural reform
Chapter 1. The German labour market: preparing for the future
	Past labour market reforms paid off handsomely during the crisis
		Figure 1.1. Unemployment rates and Okun coefficients
		Box 1.1. Alternative explanations for the benign unemployment response
			Table 1.1. Decomposing the increase in the unemployment rate
		Increased work incentives and better job matching
			Table 1.2. A timeframe of labour market reforms in Germany during the last decade
			Figure 1.2. NAIRU and Beveridge curve
			Figure 1.3. Wage moderation prior to the crisis and employment during the crisis
		Increased working­time flexibility at the firm level
			Figure 1.4. Hours worked adjustment in the crisis and hourly labour productivity in the crisis
			Table 1.3. Contributions to changes in average annual working hours per employee
			Figure 1.5. Short­time work schemes – take­up by firms
	Long­term challenges remain
		Box 1.2. Impact of ageing on economic growth
		Figure 1.6. Projected labour force development
		Raising incentives for secondary earners
			Figure 1.7. Fiscal disincentives and working hours of second earners
		Further increasing employment of older workers
			Figure 1.8. Employment rates of older workers
			Figure 1.9. Seniority wages, tertiary education and hiring of older workers
			Figure 1.10. Participation in training and effective retirement age
		Continuing with education reforms
			Figure 1.11. Share of German youth prepared for university
		Avoiding the development of a dual labour market
		Adapting migration policy
			Figure 1.12. Aspects of migration to Germany
			Box 1.3. What Germany can expect from opening its labour market to new EU member states
			Figure 1.13. International students staying in Germany
			Box 1.4. Recommendations for the labour market
	Notes
	Bibliography
	Annex 1.A1.  Estimating Okun’s law for Germany
		Figure 1.A1.1. The German Okun coefficient over time
		Figure 1.A1.2. Actual vs. simulated labour market outcomes
	Annex 1.A2. The impact of the sectoral composition of the recession on the unemployment response
		Figure 1.A2.1. Change in employment by sector
		Figure 1.A2.2. Actual versus projected quarterly employment growth across sectors
	Annex 1.A3. The impact of labour shortages on labour market outcomes
		Figure 1.A3.1. Indicators of labour shortages
		Figure 1.A3.2. Impact of labour shortages on unemployment and employment growth
Chapter 2. Climate change policies: make ambition pay
	Germany has committed itself to challenging reductions in greenhouse gas emissions
		Germany substantially reduced GHG emissions but remains an important emitter
			Figure 2.1. Change in greenhouse gas emissions and energy intensity
			Figure 2.2. Greenhouse gas emissions: international comparison and sectoral distribution, 2009
			Table 2.1. Decomposition of GHG emission levels in 2009
			Figure 2.3. A carbon intensive energy mix and an energy intensive industry
		Germany has fixed ambitious targets for 2020
			Box 2.1. Germany and nuclear power: strong public opposition and a political seesaw
	Climate change policies need to become more cost­efficient
		Achieving the targets may be costly for Germany
		Improving the framework of climate change policies
		Putting a price on GHG emissions
			Figure 2.4. Environmental tax revenues, 2009
		Fostering energy savings and renewable energy sources
			Figure 2.5. Renewable energy sources in the electricity sector
			Table 2.2. Feed­in tariffs in Germany
			Figure 2.6. Renewable energy sources and feed­in tariffs, 2009
	Continuing the green growth success story
		Germany is a leader in green technologies…
			Box 2.2. Evaluation of the impact of RES policy on employment and growth
		… and this competitive advantage should be maintained
			Box 2.3. Competition in the German energy sectors
				Figure 2.7. Regulation in the electricity and gas sectors, 2007
			Box 2.4. Options for eco­innovation
			Figure 2.8. R&D spending and innovation in environmental areas
			Figure 2.9. Financing innovation: venture capital and government support of business R&D
			Box 2.5. Recommendations for climate change mitigation and green growth policy
	Notes
	Bibliography