Recent advances and trends
The leading centers of economic research in Germany today continue to be Bonn, Cologne, Kiel, and Mannheim (not necessarily in that order), though very strong centers have also emerged in Berlin, Karlsruhe, and Munich.
The Anglophone influences in the German economics profession today are pervasive, having created a thoroughly international discipline that extends to virtually all areas, whether it be pedagogy, methodology, research fields, language of publication, professional journals, or academic networks. Nearly all German economic journals today publish in English, and it is now common for young aspiring academic economists to have publications in the leading American journals. As a result, some of the distinctly “German” features of economic thinking, notably the historical and Ordo-Liberal strands, have been pushed to the margins. Yet in a country where powerful institutions have long played such a predominant role in the economy and where heterodox economic thought has a long and proud tradition, it is not surprising that institutional, experimental, and evolutionary approaches have emerged in recent years. Evolutionary economics has been cultivated at the Max Planck Institute for Economics, founded in Jena in 1993. The Verein fur Socialpolitik has also been open to these newer heterodox trends.Since well before the Euro’s formal introduction in 1999, prominent German economists were critics of the single currency for the distorting impact it would have on competitiveness within the EU due to the wide productivity, wage, and price disparities within Europe. More recently they have criticized the resulting accumulation of Euro-denominated debt in less competitive Eurozone countries and the Euro’s inadequate institutional foundations, notably the lack of harmonized taxation and public spending to counterweigh these distorting effects. They have also pointed out that the Euro was and is a political project and that their expert advice was routinely ignored by the European and German politicians behind its creation. Due to the outsized influence of the German Bundesbank on the European System of Central Banks (ESCB), the monetary policy of the European Central Bank (ECB) has had a distinctly deflationary bias, something that has been criticized by many economists outside of Germany. Some prominent German economists, led by Hans-Werner Sinn of the Ifo-Institut, have recently panned proposals for a European banking union and been sharply critical of the ECB bond purchases undertaken to combat the Eurozone debt crisis which emerged after the “Great Recession” of 2008—9. Others such as Kai Konrad of the Max Planck Institute for Tax Law and Public Finance have proposed that Germany leave the Euro in order to save the EU.