Tuesday, May 7, 2013


Has been looking at data on Deutschland from 2006-2012 and asking 'compared to what';
So employment rose by 7.1% over a period of nearly 7 years, and hours per worker fell by 3.1%.  That means hours rose by 4%.  Productivity rose by 4.7% and RGDP rose by 8.8% (roughly half from more hours worked, and half from improved hourly productivity.)
Many commenters pointed to various job sharing programs, or subsidies to keep workers employed during the recession.  Libetaer used the metaphor of putting 2 workers in one chair.  The one chair reflects relatively meager growth in NGDP, and the two workers represent job sharing.
It would be a mistake to assume that the German miracle was an illusion due to all this job sharing and slow productivity growth (caused by keeping excess workers around.)  The welfare loss to a society from a 5% RGDP shock is much greater if 5% of workers lose their jobs, as compared to all workers staying employed, but working 5% less hard.  Yes, the miracle seems marginally less impressive, but I’d still prefer Germany’s labor market to France’s.
Or Portugal's, Spain's, Italy's, Greece's....

No comments:

Post a Comment