This paper provides a comparative analysis of training regimes in Germany and the Netherlands. Both countries are CMEs with similar institutions, but their training regimes differ in important ways. The paper first maps the similarities and differences in the training regimes in both countries and then turns to three questions that frame the analysis of these similarities and differences. First, how have skills regimes adjusted to changes in economic and employment structure, such as de-industrialization and the rise of the service economy? Second, how much does the structure and adaptability of the raining regime help to explain the relative success of the Dutch employment miracle? Does the Dutch training regime represent successful institutional adaptation to changed economic circumstances? Conversely, does the inflexibility of the training regime contribute to the German employment malaise? Finally, what do these findings suggest for the analysis of the political economy of skills regimes in other CMEs?
This paper investigates the causes of, and reactions to, the Eurozone crisis, focusing in particular on the institutional foundations of the four Southern European Eurozone countries that have encountered an acute sovereign debt crisis. Applying the basic arguments featured in the Varieties of Capitalism literature, the paper aims to show how the interaction of the institutional set-up of coordinated and mixed market economies, with the effects of the common currency area, can explain both the evolution of the crisis, as well as the reactions to it. This paper interprets the sovereign debt crisis in the Eurozone as the combination of two features: firstly, the architecture of the common currency area, which instituted a common interest rate for widely heterogeneous regional economies, and secondly, the specific institutional foundations of two types of economies participating in the Eurozone, namely coordinated market economies and mixed market economies. Understanding these two factors and their interaction not only helps to explain why the Southern European countries were particularly vulnerable to exploding public debt, but also why, during the on-going resolution of the Eurozone crisis over the last two years, policy makers have persistently preferred austerity over the mutualisation of debt. The compensatory role of the state in mixed-market economies thereby undermines the effectiveness of financial bail-outs for economic growth strategies.
This paper provides an overview of the actual and likely labour market transformations caused by increasing use of Artificial Intelligence (AI) technologies across the advanced economies, with a special focus on Germany. The scholarly debates on these issues mainly revolve around the impact of AI on the number and structure of jobs, and around AI-enabled management tools’ perpetuation and aggravation of work-related inequalities and discrimination. The study starts with a brief background of AI as a technology, with a focus on its definition, subfields, capabilities, and history. Following this, it reviews the discussions on the implications of AI use in the world of work and its ethical and political repercussions and continues with a summary of AI use and its impacts in German labour markets. It then discusses the current gaps in the relevant scholarly literature and identifies numerous opportunities for further research.
The investigation concludes by addressing two far-reaching implications of increasing utilisation of AI-enabled tools in labour markets. First, in the case that the current trends remain unchanged, the AI-driven future of work is likely to perpetuate and aggravate work-related inequalities and discrimination, diminishing further the prospects of decent work, fair remuneration and adequate social protection for all. Second, predictions provided by current studies only point out one possibility amongst many. Thus, we still have choices as to the advancement, adoption, and utilisation of workplace AI technologies in a way that brings benefit to all.
Digital automation has pervaded many areas of our daily activities, with serious repercussions for social, economic and political systems. Automation’s ever-enhancing capability to transform human lives has spawned a wide body of scholarly research, with inputs from social and economic sciences, engineering and technology. This paper1 provides a brief overview of the main arguments put forward by the researchers, particularly in labour economics, on the subject of digital automation, with a special focus on Germany. Such debates revolve around the impact of automation on the number of jobs performed by human labour and the restructuring of labour markets under the influence of automation. The overview starts with a short discussion about the meaning of digital automation. It then outlines the debates of how technology distributes work between humans and machines from the viewpoint of skill-biased technological change and routine-biased technological change research. This is followed by a summary of the way digital technologies have been restructuring the world of work.
The overview concludes by pointing out research gaps that are particularly relevant in the German context. It emphasizes that a new research agenda should incorporate the role of existing education and training regimes (VET), in particular in light of employment polarisation and the shrinking employment segment of jobs with mid-level pay and skills. Moreover, there is a lack of research that considers the insights of industrial sociology with regard to the renegotiation of work organisation in the process of automation. In particular, the role of institutional factors, such as workers’ representatives, in the form of trade unions or works councils, has largely been neglected by studies on labour economics. Finally, there should be more attention paid to the differentiated effects of automation on specific socio-economic groups, such as women and men, but also between different generations.
In this essay, part of our Navigating Economic Change series, Anke Hassel and Kathleen Thelen explore strategies for mitigating some of the income, job and educational inequalities that rich democracies are currently confronting as a result of technological change and the growing gap between winners and losers in the new knowledge economy.
Wie kommt das Neue in die Welt? Die Suche nach Antworten auf diese Frage ist angesichts der Herausforderungen, vor denen Deutschland bei der Dekarbonisierung und Digitalisierung von Wirtschaft und Gesellschaft steht, keine philosophische Übung, sondern eine der dringlichsten Aufgaben unserer Zeit. Denn ob es der Bundesrepublik gelingt, Vorreiter einer digitalen Nachhaltigkeitsökonomie zu werden und wettbewerbsfähig zu bleiben, hängt in hohem Maße von der technologischen und gesellschaftlichen Innovationskraft des Landes ab.
Eine repräsentative Civey-Umfrage im Auftrag des Progressiven Zentrums zeigt: Über drei Viertel der Befragten sind der Meinung, dass die deutsche Regierung nicht genug für die Innovationsfähigkeit der deutschen Wirtschaft tut (78 %). Mehr als 80 Prozent stimmen der Aussage zu, die Bundesregierung solle klare Ziele für die Förderung von technologischen Innovationen setzen. Den Befragten zufolge sollten technische Innovationen vor allem der Wettbewerbsfähigkeit dienen (44 %), gefolgt von der nationalen Sicherheit (30 %), sozialer Gerechtigkeit (29 %) und Klimaschutz (28 %). Im direkten Vergleich mit China und den USA sagten nur 13 Prozent der Befragten, die EU sei der innovativste Wirtschaftsstandort. Knapp 40 Prozent halten die chinesische Wirtschaft für die innovativste, etwa 30 Prozent finden die USA als Wirtschaftsstandort am innovativsten.
Vor diesem Hintergrund untersucht die Studie die Zukunftsfähigkeit des deutschen Innovationsmodells und begibt sich auf die Suche nach konkreten Reformvorschlägen für dessen politische Steuerung.
Executive Summary:
▪ The German government has taken decisive actions in response to the dual economic shocks linked to the Covid-19 pandemic and Russian gas supplies’ cut-off – with the main objective of protecting its export-oriented industrial economy.
▪ By engaging in "competitive corporatism," the coalitional government has worked closely with the social partners – especially representatives from the chemical and metalworking-engineering export sectors – to restore domestic firms’ cost competitiveness while providing social compensation to vulnerable households and individuals.
▪ The government's concerted threefold strategy to uphold the export-led growth regime includes: (1) measures aimed at reducing firms’ energy costs; (2) in/direct measures aimed at controlling the rise of labour costs to prevent a wage-price spiral; (3) substantial state aid provided to ailing firms.
▪ The scope of state intervention in Germany's economy is unparalleled, entailing significant fiscal outlays for protective measures, made possible by Germany’s advantageous sovereign refinancing capacity. Germany’s economic activism risks jeopardising the EU single market due to extensive state aid, especially since Germany resists joint fiscal resource pooling for EU-wide industrial policy.
The sharp increase in inflation across Europe over the last two years has led to calls from some actors for a policy of wage restraint to prevent a vicious circle of price rises. Yet as Martin Höpner, Anke Hassel and Donato Di Carlo write, the fact that “wage restraint” can be understood in multiple different ways has created confusion about the link between wages and prices.