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Nachhaltige Finanz‐ und Investitionspolitik der Bundesländer: Die ostdeutsche Perspektive

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  • Helmut Seitz

Abstract

The article examines the fiscal adjustments necessary in East Germany to ensure that the East German state and local government sector runs a sustainable fiscal policy in the next decades and maintains a high level of public investment expenditures. The latter is of special importance in East Germany because in some areas the public infrastructure capital stock in East Germany is still deficient as compared to West German standards. In addition, regional development policy still uses capital subsidies to attract mobile business capital to East Germany. These subsidies are co‐financed by the East German state governments, the federal government as well as the EU. We derive a sustainable time path of primary expenditures in East Germany and estimate the volume of investment expenditures that can be financed without violating fundamental sustainability restrictions. In addition, we inspect the fiscal federalism perspective of public investment taking into account the specific institutional settings in Germany.

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  • Helmut Seitz, 2007. "Nachhaltige Finanz‐ und Investitionspolitik der Bundesländer: Die ostdeutsche Perspektive," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 8(S1), pages 84-115, April.
    • Handle: RePEc:bla:perwir:v:8:y:2007:i:s1:p:84-115
    DOI: 10.1111/j.1468-2516.2007.00244.x
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    References listed on IDEAS

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    1. Helmut Seitz, 2006. "Zur Quantifizierung des "Korb 2" im Rahmen des Solidarpakts II," ifo Dresden berichtet, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 13(05), pages .24-30, October.
    2. Henning Bohn, 1998. "The Behavior of U. S. Public Debt and Deficits," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 113(3), pages 949-963.
    3. Helmut Seitz, 2006. "Zur Quantifizierung des "Korb 2" im Rahmen des Solidarpakts II," ifo Dresden berichtet, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 13(05), pages 24-30, October.
    4. Ward Romp & Jakob De Haan, 2007. "Public Capital and Economic Growth: A Critical Survey," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 8(S1), pages 6-52, April.
    5. Bradford, David F & Oates, Wallace E, 1971. "Towards a Predictive Theory of Intergovernmental Grants," American Economic Review, American Economic Association, vol. 61(2), pages 440-448, May.
    6. Hulten, Charles R. & Schwab, Robert M., 1997. "A fiscal federalism approach to infrastructure policy," Regional Science and Urban Economics, Elsevier, vol. 27(2), pages 139-159, April.
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