German Economic Models, Transnationalization and European Imbalances

32 Pages Posted: 13 Jan 2014

See all articles by Hans‐Michael Trautwein

Hans‐Michael Trautwein

Carl von Ossietzky Universität Oldenburg; ZenTra - Center for Transnational Studies

Finn Marten Körner

ZenTra - Center for Transnational Studies; Uniper SE

Date Written: January 12, 2014


Germany’s net exports and macroeconomic policy stance are controversial issues in current debates about the Eurozone debt crisis. This paper shows that both are characteristics of what has been described in a variety of political economy literatures as the German socio-economic model. We argue that the model has evolved in three stages, from the economic miracle of the post-war era through the era of “Germany Inc.” and Bundesbank hegemony to the present transnationalization of German industries and finance. The three stages of the German model – or Models D, mark I-III – correspond closely to the exchange rate regimes of Bretton Woods, the European Monetary System and European Monetary Union (EMU). We describe them in three analogous settings that specify their different working conditions under the respective exchange-rate regime, following a chronology of success, dynamic instability and transformation. We point out that, while the German economy has under-gone substantial changes, there are two different mindsets of model thinking in Germany that have been remarkably persistent in public debate. We refer to these two mindsets as ordoliberalism and neo-mercantilism. Ordoliberalism is the normative mindset of policy speakers and academic economists, whereas neo-mercantilism is the practical mindset of policymakers and business leaders. We discuss the differences and complementary uses of these modes of German model thinking and draw attention to their flaws and inadequacies at the present stage of European integration and transnationalization of the German economy.

Keywords: macroeconomic policy regimes, export-led growth, global imbalances, ordoliberalism, neo-mercantilism

JEL Classification: E61, F43, F62, N14, O43

Suggested Citation

Trautwein, Hans-Michael and Trautwein, Hans-Michael and Körner, Finn Marten and Körner, Finn Marten, German Economic Models, Transnationalization and European Imbalances (January 12, 2014). ZenTra Working Paper in Transnational Studies No. 28 / 2014, Available at SSRN: or

Hans-Michael Trautwein (Contact Author)

Carl von Ossietzky Universität Oldenburg ( email )

Ammerländer Heerstraße 114-118
Oldenburg, D-26111


ZenTra - Center for Transnational Studies ( email )

Ammerländer Heerstraße 138
Oldenburg, 26131

Finn Marten Körner

ZenTra - Center for Transnational Studies ( email )

Carl von Ossietzky University of Oldenburg
Ammerländer Heerstraße 138
Oldenburg, 26129


Uniper SE ( email )

E.ON-Platz 1
Düsseldorf, 40479

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