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Licensed Unlicensed Requires Authentication Published by De Gruyter Oldenbourg September 18, 2019

Germany’s Growth Prospects against the Backdrop of Demographic Change

  • Sebastian Breuer EMAIL logo and Steffen Elstner


This paper shows how the German Council of Economic Experts (GCEE) determines Germany’s potential output, and compares the results with those of the European Commission. The approach of the European Commission is a natural benchmark, as it provides the basis for the deficit and debt rules of the European Union. In comparison with the European Commission’s method, the GCEE’s method places greater emphasis on demographic factors in estimating labour input. Additionally, both approaches differ regarding how they estimate the structural unemployment rate and total factor productivity. Finally, this paper discusses the limitations of, and the different options for estimating potential output.

JEL Classification: O40; E17; E37


The authors are very grateful for the support and helpful comments from Julia Richter, Ina Holl, Désirée I. Christofzik, Jeanne Diesteldorf, Anabell Kohlmeier, Claudia Schmiedchen, Leo Brinster, Alexander Burstedde, Atanas Hristov, Manuel Kallweit, Marcus Klemm, Werner Röger, Benjamin Weigert, the Forecasting Center of the Kiel Institute for the World Economy, and the members of the German Council of Economic Experts, particularly Christoph M. Schmidt and Lars P. Feld.


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Supplementary Material

The online version of this article offers supplementary material (

Received: 2018-11-26
Revised: 2019-05-07
Accepted: 2019-07-15
Published Online: 2019-09-18
Published in Print: 2020-10-25

© 2019 Oldenbourg Wissenschaftsverlag GmbH, Published by De Gruyter Oldenbourg, Berlin/Boston

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