Economic Implications of German Unification for the Federal Republic and the Rest of the World

54 Pages Posted: 15 Feb 2006

See all articles by Paul R. Masson

Paul R. Masson

International Monetary Fund (IMF) - Research Department; The Brookings Institution

Guy Meredith

International Monetary Fund (IMF) - Research Department

Date Written: September 1990

Abstract

The economic effects of German unification are first discussed in the context of a global saving/investment model. Next, simulations of MULTIMOD are presented, suggesting for the FRG an initial increase in long-term real interest rates equal to 3/4 of a percentage point, increased output, a temporary haIf-point rise in inflation, a modest real appreciation of the deutsche mark, and a reduction of the (combined GDR and FRG) current account surplus equal to 2 percent of GNP. Effects on the rest of the world seem to be relatively small. Different policies are examined within the EMS, and other simulation studies are surveyed.

JEL Classification: 122, 124, 210, 423

Suggested Citation

Masson, Paul R. and Meredith, Guy, Economic Implications of German Unification for the Federal Republic and the Rest of the World (September 1990). Available at SSRN: https://ssrn.com/abstract=885026 or http://dx.doi.org/10.2139/ssrn.885026

Paul R. Masson (Contact Author)

International Monetary Fund (IMF) - Research Department ( email )

700 19th Street NW
Washington, DC 20431
United States

The Brookings Institution ( email )

1775 Massachusetts Ave. NW
Washington, DC 20036-2188
United States
202-797-6278 (Phone)
202-797-2968 (Fax)

Guy Meredith

International Monetary Fund (IMF) - Research Department ( email )

700 19th Street NW
Washington, DC 20431
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
45
Abstract Views
1,029
PlumX Metrics