Status: 03/28/2023 2:27 p.m
Pandemic, inflation, Ukraine war: The German economy and society are currently being burdened by crises. In an international comparison, the country has a high level of resilience, according to a recent study.
Coping with crises is remarkably successful in Germany. Overall, the country has a high level of “resilience”, i.e. the ability to compensate for stress and adapt to changing circumstances.
This is the result of a study by the Roman Herzog Institute on behalf of the Bavarian Business Association (vbw). A team led by economist Michael Hüther, head of the German Economic Institute, has evaluated existing studies on the resilience of states.
Democracies react more flexibly
In the ranking list of 24 industrial countries examined, Germany ranks sixth, behind Norway, Finland, Sweden, Switzerland and Denmark. The authors also come to the conclusion that democracies are generally more flexible and ultimately more successful in responding to and overcoming crises than authoritarian regimes. In a resilience comparison, China and Russia occupy the last two places.
The study highlights social cohesion and trust in state institutions as strengths of democratically organized societies. The good overall performance of the Scandinavian countries, where according to the study the welfare state system is well developed, is justified accordingly.
Low national debt creates freedom
Mainly thanks to its economic strength, Germany has developed a high level of resilience to crises. The national debt, which is low by international comparison, ensured that aid packages worth billions could be made available to companies, for example to deal with the Corona crisis. As a business location, Germany is very attractive for companies, but according to the study, it is increasingly falling behind when it comes to assessing innovative strength and the dynamics of the economy.
The dual training system, in turn, ensures that Germany, unlike Greece, Portugal or Spain, is less affected by the issue of youth unemployment. “Equal opportunities in Germany have increased, but income inequality has not,” the authors emphasize positively. The labor market has also developed favorably, the high-wage country has also “become a high-employment country”. However, there is currently a shortage of skilled workers in this country.
Leader in sustainability
Even if bureaucratic hurdles often slow down necessary innovation in Germany in the economy, the country is even in the top group of the countries examined when it comes to sustainability. “Of all industrialized countries, Germany achieves the most sustainability goals of the United Nations,” says the study. Overall, the study concludes, thanks to its resilience, Germany can face the challenges of the coming years with “comparative composure”.