Advantages of increasing public investment in Germany
Between 2005 and 2014, the German government allocated an average of 2.2% of its GDP for the construction and renovation of roads, schools and day care centres. This is significantly less than the OECD average for the same period (3.3%). A recent study conducted by Prognos uses scenarios to show the impact of increasing and sustaining public investment in Germany by 2025. If Germany were to invest 3.3% of its GDP annually (same as the OECD average), GDP growth would be 1.6% per year. That way in 2025 Germany could generate almost 80 billion more €. Furthermore, the authors confirm that an increase in public investment does not conflict with the German debt rule and the "black zero".
Autor: Dr. Michael Böhmer, Markus Hoch (Prognos AG), Manuela Barišić, Fritz Putzhammer (Bertelsmann Stiftung)
Kunde: Bertelsmann Stiftung