## Germany In An Interconnected World Economy

_Books, April 10, 2013_

## Source details

**Canonical URL:** [Germany In An Interconnected World Economy](https://www.imf.org/en/publications/books/issues/2016/12/31/germany-in-an-interconnected-world-economy-26173)

## Other formats

- [Markdown version](/en/publications/books/issues/2016/12/31/germany-in-an-interconnected-world-economy-26173/index.md)
- [Structured JSON version](/en/publications/books/issues/2016/12/31/germany-in-an-interconnected-world-economy-26173/index.json)
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## Bibliographic details
- Authors: Ashoka Mody
- Published: April 10, 2013
- Series: Books
- DOI: https://doi.org/10.5089/9781616354244.071

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### Overview and key findings
- Germany has been a central player in discussions on the future architecture of Europe and has been called on to play a larger role in supporting global and, especially, European recovery from the financial crisis that triggered the Great Recession.
- The book shows that the quantitative effects of a German fiscal stimulus would be small on the heavily indebted euro area periphery countries that most need the boost.
- The book finds that Germany itself faces a growth challenge and that efforts to raise its own growth potential are important for Germany.
- More rapid growth of domestic demand in Germany will more powerfully stimulate European economic growth through its expanded demand for imports.

### Policy implications and analysis
- A German fiscal stimulus alone is unlikely to generate large positive spillovers to heavily indebted euro area periphery countries.
- Strengthening Germany’s own growth potential is important both for Germany and for Europe, because domestic-demand-led growth in Germany increases import demand and thereby stimulates European growth more effectively than unilateral fiscal measures aimed at external spillovers.

### Subjects and keywords
- Subject: Current account; Employment; Financial sector policy and analysis; Labor; Labor markets; Production; Productivity; Spillovers; Total factor productivity
- Keywords: Asia and Pacific; BOOK; Central Asia; Eastern Europe; economist in the European Department; economist in the Ministry of Finance; Employment; Europe; Germany; Global; growth shock; IMF staff estimate; labor market; Labor markets; Middle East; Productivity; productivity growth; spillover effect; Spillovers; structural policy; TFP growth; Total factor productivity

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_Source: https://www.imf.org/en/publications/books/issues/2016/12/31/germany-in-an-interconnected-world-economy-26173_