Is There a German Macroeconomics?

Is There a German Macroeconomics?


A new post by Simon Wren-Lewis, referencing an interesting conference on the topic. Here is an older post by Tony Yates.


Without having read the conference volume yet, I would like to offer my own thoughts to highlight an aspect that I have not heared talk about in the Anglosaxon world, when they try to understand the specificity of German economics. But first let's be clear: German academic macroeconomics is in an excellent state. Anyone who knows the scene a bit knows that there are lots of great and very well published young German macroeconomists. Any German university currently trying to fill a chair in macroeconomics can select from people who publish regularly in the best journals.German macroeconomists are fully integrated into the international and US scene. No insularity anymore.

So the question is: why aren't they more politically influential. One obvious answer might be that they are simply too (academically) young, still very research active, so their opportunity cost of time is high. Also, given their historic insularity and unlike their US counterparts they may still want to go the extra mile to prove that they are serious researchers. This explanation may have some bite, but I doubt it is the most important one. If it was right, the whole thing would be transitory. If, however, my hypothesis is correct, we should not expect to see them gain any major political influence anytime soon.

Here it is: historically, the view that the state is an entity sui generis, a source of ultimate reason and rationality, and not just a means of people to organize their living together, is deeply ingrained not just in German philosophy, but in German mentality. Therefore, traditionally economics in German was a "state science", a Staatswissenschaft (you can still see this heritage in some names of economics departments). But of course, the queen of the "state sciences" has always been law, not economics. This is totally different in the Anglosaxon sphere, where economics is a social science, and, arguably, its most eminent example, its queen. The bottom line of this is the following: economists never really had much influence in German politics, the German intellectuals have always looked down on it, and this is still the case. Law (and social philosophy) dominates - a guy like Juergen Habermas is trusted more on economic issues in Germany than any economist. Wolfgang Schäuble is a lawyer and is known to reject economics and the arguments of economists. Germans just admire more the formalistic reasoning of lawyers than the outcome-oriented, pragmatic reasoning of economists. There is even a pejorative word in German derived from an old word for business people, meaning small-mindedness, Krämerseele.

Why then - one may ask - did Ordoliberalism gain seemingly so much influence on German politics and economic policies? The answer is simply: a lot of Ordoliberalism is just very similar to law, it's all about frameworks, rules, formal reasoning. So, my claim is that economists are only respected and accepted in the broader public discourse if they are like lawyers. And my conjecture is that this will remain so.


Autor: Rüdiger Bachmann (Nachwuchsbeauftragter). Die hier geäußerten Meinungen sind nicht unbedingt die Sicht des Vereins für Socialpolitik.