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). IMF Working Paper No. 90/85, Available at SSRN: https://ssrn.com/abstract=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
1,006
PlumX Metrics