It is imperative to note that macroeconomic performance is a fascinating topic that is actively discussed by many scholars. The situation in Germany is especially interesting, and it is influenced by numerous internal and external factors. For instance, an increase in spending on refugees has helped to boost the economy (Wagstyl 2016). Such changes can be hard to predict most of the time, and necessary measures should be taken to avoid possible risks. Furthermore, the need to review core indicators should not be overlooked, and it would help to get a better understanding of why the economy in the country is so efficient.
It is possible to see that the GDP growth rate has been quite stable over the years, and it has varied in the range from -0,5% to 1%. This situation can be explained by the fact that Germany has established its position as one of the leaders in export. Household consumption makes up fifty-five percent of GDP expenditures. According to the latest available information, GDP has reached $3868.29 billion, and this is the biggest number in the history of the country. The number of exported goods has been rising, and it has reached a record mark of 107492 million Euros in 2015. The number of funds spent by the government has also increased, and it is 133,83 billion Euros. The situation in the area of imports is not that good in 2016 so far, but numbers from 2012 to 2015 were outstanding (Germany economic indicators 2016). Furthermore, the AD-AS model suggests that an increase in export, government spending, and capital investments may cause higher aggregate demands, and it leads to economic growth (Serletis 2013).
The fact that employment rates have been steadily increasing over the last few years is also worth highlighting. It has been 73 percent in 2012 and is 74,2 currently. Also, wage growth has been quite significant and has increased from 0,5 to 2,10 over the years (Germany economic indicators 2016). It is suggested that the level of employment is related to aggregate demand (Sheehan 2009). It can be seen that it has been increasing in Germany over the last five years. Moreover, it is not surprising that the percentages have been affected. However, the fact that other aspects also play a vital role should be taken into account. One of the core factors that have influenced these numbers is that a minimum wage has been established by the government in 2015. However, the issue is that many individuals do not work full-time, and it could complicate the development of the economy. Higher wages make the population much more interested in employment, but poverty is still a critical problem that needs to be resolved because it affects the situation in the country as a whole.
In conclusion, it is evident that the macroeconomic performance of Germany is outstanding, and the country is developing at rapid rates. However, it has to deal with several challenges, and they should be addressed to ensure that the position of one of the leaders in the world is maintained. The problem is that most consumers lack confidence, and they are too worried about possible issues related to the job market (Worthing 2016). Overall, the government should focus on the development of appropriate policies because the country is too dependent on car manufacturing and export.
Reference List
Germany economic indicators 2016, Web.
Serletis, A 2013, The Demand for money: Theoretical and empirical approaches, Springer Science & Business Media, Berlin, DE.
Sheehan, B 2009, Understanding Keynes’ general theory, Palgrave Macmillan, London, UK.
Wagstyl, S 2016, ‘Consumer spending drives Germany’s economic growth’, Financial Times, Web.
Worthing, J 2016, ‘Europe on the brink of financial meltdown as Germany faces economic ruin’, Express, Web.