Germany's economy continues to sink; will politicians reform?

[Kidlicious]

Originally posted by Giancarlo


For a short time, yes. But if you have them for a very long period of time, or forever, it would encourage people not to work. Sorry but communism doesn't work.

By ending unemployment benefits you eliminate consumers. That's bad for recessions. If you create the jobs people will work. I've never believed that there are jobs out there, and people to work them that won't. If there is a job and someone to work it the person will be hired.

[Dinner]

Originally posted by Kidicious


No. Productivity impovements do nothing for stability, and can actually cause a recession.

Ok, so in your opinion lower productivity leads to a better economy? Score another one for the kidaverse!

[chequita guevara]

Originally posted by Oerdin
Ok, so in your opinion lower productivity leads to a better economy?

That's not what he wrote.

[Giancarlo]

Originally posted by Kidicious


By ending unemployment benefits you eliminate consumers. That's bad for recessions. If you create the jobs people will work. I've never believed that there are jobs out there, and people to work them that won't. If there is a job and someone to work it the person will be hired.

The state can't create jobs that will benefit society (state jobs don't do anything to help). That is up to businesses. By increasing unemployment benefits you need to pay for it somehow... ah yes.. increasing taxes on people and businesses by driving businesses out. Example: California.

[Dinner]

Originally posted by chegitz guevara
No it doesn't. Higher productivity is what causes recessions, as increased output isn't matched by increased demand.

In the short run, yes, higher productivity does mean fewer workers are needed to do the same job. In the long run it means companies and employees are better able to compete for available work and are more profitable, ergo, the companies are more stable and more likely to hirer additional labor. You might have more workers in a low productivity company but you will quickly have no workers after the company goes bankrupt; also each individual worker is worth more if he is more productive so he can be paid more.

[DanS]

There is so much bad economics in this thread (more than usual), the stench is starting to get to me.

[Kidlicious]

Originally posted by Oerdin


Ok, so in your opinion lower productivity leads to a better economy? Score another one for the kidaverse!

Imagine that employers hire more in a recession so that producivity falls. Of course, that would be good for the economy. It would prevent the recession.

[Kidlicious]

Originally posted by DanS
There is so much bad economics in this thread (more than usual), the stench is starting to get to me.

Another nice rebuttal DanS. It seems that you can only talk to people who agree with you.

[chequita guevara]

Originally posted by Oerdin
In the short run, yes, higher productivity does mean fewer workers are needed to do the same job. In the long run it means companies and employees are better able to compete for available work and are more profitable, ergo, the companies are more stable and more likely to hirer additional labor.

Which is entirely beside the point. It is definately the case that increased productivity sets the stage for the next growth cycle, but increased productivity is what causes recessions. This whole libertarian notion that the economy comes out of each recession stronger is rather Darwinian, as it means ruined lives for many people. Why should a minority of individuals be forced to pay the brunt of economic cycles, rather than spreading the pain thin as they do in Germany?

Germany isn't hurting as bad as some Americans like to pretend. It's not like German companies are going bankrupt all over the place. And despite the fact that we have more growth (unless you read el freako's analyses) and make more money on average, Germans tend to have a better standard of living. I don't really think we're in a position to be telling Germany what to do economically.

[Dinner]

Originally posted by chegitz guevara


That's not what he wrote.

He said "No. Productivity impovements do nothing for stability, and can actually cause a recession.". Productivity improvements most certainly lead to more stabilty, in the long run, by increasing profits and decreasing costs. This helps to make companies more competative and more likely to stay in business.

Yes, if you get sudden massive increases in productivity an employer won't need as many workers but let's face reality. Productivity normally increases at a slow but steady rate so you're not going to get enough lay offs to trigger a recession. The opposite is true; that increased productivity means the company wins more contracts and so must hirer additional workers.

[Kidlicious]

Originally posted by Giancarlo


The state can't create jobs that will benefit society (state jobs don't do anything to help). That is up to businesses. By increasing unemployment benefits you need to pay for it somehow... ah yes.. increasing taxes on people and businesses by driving businesses out. Example: California.

Any job benefits society in a recession. The worker now has money to spend. That's good for everyone, and it's what ends a recession.

[Dinner]

Originally posted by chegitz guevara
Increased productivity is what causes recessions.

Site?

[chequita guevara]

Originally posted by Oerdin
Site?

Marx, Kenyes, Galbraith, Freedman, etc.

[Kidlicious]

Oerdin,

There are two different ways that productivity improves. It is either supply side or demand side. Demand side productivity improvements do not cause recessions, but supply side productivity improvemenst can cause recessions. There were productivity improvements right before the Depression, and it was one of the causes.

[Giancarlo]

Originally posted by Kidicious


Any job benefits society in a recession. The worker now has money to spend. That's good for everyone, and it's what ends a recession.

State jobs require money and that requires either taxing the citizens or businesses. I suggest a smaller central government is what is needed. Keynesism is stupid by the way.