Using a newly constructed macroeconometric model for Germany and the rest of the Euro area, we investigate the macroeconomic effects of structural labor market reforms in Germany. We find that neither the fact that Germany can no longer pursue an independent monetary policy nor the possibility...

This paper uses an extended version of “FiMod—A DSGE Model for Fiscal Policy Simulations” (Stähler and Thomas Econ Model 29:239–261, 2012) with endogenous job destruction decisions by private firms to analyze the effects of several currently discussed labor market reforms on the Spanish...

This paper uses an extended version of “FiMod – A DSGE Model for Fiscal Policy Simulations” (Stähler and Thomas, 2011) with endogenous job destruction decisions by private firms to analyze the effects of several currently discussed labor market reforms on the Spanish economy. The main...

The number of unemployed workers in Germany decreased dramatically from its peak in February 2005 at over 5.2 million to 3.6 million by 2008. At the same time, employment increased by 1.2 million. Most theoretical and empirical analyses of this episode assume that a worker leaving unemployment...