About this article
Published Online: Oct 26, 2023
Page range: 660 - 664
DOI: https://doi.org/10.2478/wd-2023-0185
Keywords
© 2023 Michael Hüther, published by Sciendo
This work is licensed under the Creative Commons Attribution 4.0 International License.
Germany’s manufacturing sector still shows gross fixed capital formation below pre-coronavirus levels and has been stuck in a recessionary trend since 2018. The advantages of German industry are at risk. Therefore, the federal government has to i) ensure that time is bridged and companies are supported until cheap energy is available, ii) improve investment conditions, iii) eliminate locational disadvantages (tax burdens, energy costs) and strengthen advantages (R&D, human capital) and iv) reduce bureaucratic costs. There is need for tax and growth policy reform. In this regard, the debt brake turns also acts as an effective brake on tax cuts and is thus questionable in terms of growth policy.