Has economic unification succeeded? Assessments differ, depending on the criteria selected, and the benchmark used. In many areas, from productivity to infrastructure and housing, dramatic economic improvements are readily apparent. Yet daunting challenges remain: the speed of productivity convergence has slowed, unemployment remains high and net emigration continues. Looking forward, demographic and fiscal trends pose serious challenges. This paper begins with a brief look back at the experience since 1989 before turning to a discussion of current and future challenges.
Explanations for the roots and cures of the continuous divergence between East and West German political cultures tend to fall into two camps: socialization and situation. The former emphasizes the impact of socialization before and during the GDR era and ongoing (post-communist) legacies derived from Eastern Germans' previous experience, whereas the latter focuses primarily on economic difficulties after the unification that caused dissatisfaction among the population in the Eastern parts of Germany. The article argues that in order to explain the persistence and reinvigoration of an autonomous political culture during the last two decades in the new Länder, we need to synthesize the two approaches and to add a third aspect: the unification hypothesis. Although the communist period brought about a specific political culture in the GDR, the German unification process—based rather on transplantation than on adaptation—has caused it neither to diminish nor to wither away. On the contrary, the separate (post)-communist political culture was reaffirmed and reinstalled under novel circumstances.
Stephen J. Silvia
This article investigates the progress that the eastern German economy has made since unification in two areas: unemployment and output. It finds that unemployment has remained persistently higher in eastern than in western Germany and output levels have remained extremely uniform across the eastern states. Keynesian and neoclassical economists have proposed differing explanations for the endurance of high unemployment in the East. The latter have the more convincing argument, which blames high initial wages in eastern Germany for producing a labor "trap," but this account is not without flaws. The best explanation for output uniformity is the content and volume of public investment in eastern Germany since unification. Public policy in the years immediately following unification is in large part responsible for both outcomes. Economic modeling indicates that wage subsidies targeted at low-income employment would be the most effective means to break the current high-unemployment equilibrium in eastern Germany, but the political barriers to adopting such a policy are just as formidable as they were a decade ago, when such a policy was briefly considered.
German unification acted as a catalyst for the substantial transformation of the German welfare and employment regime which has taken place over the last two decades. The changes can be described as a process of a partial liberalization of the labor market within the boundaries of a coordinated industrial relations system and a conservative welfare state. This article depicts the transformation as a trend towards a more liberal welfare and employment regime by focusing on the shifting boundaries between status and income maintenance and poor relief systems.
Jeffrey Kopstein and Daniel Ziblatt
A core lesson of Germany's federal election of September 2005 is the enduring legacy of the communist past in East Germany, a legacy that substantially shapes politics in unified Germany. Fifteen years after unification, the crucial difference in German politics still lies in the East. The 2005 election demonstrated the enduring east-west divide in German party politics. The result is that Germany today has two coherent party systems, one in the East and one in the West. Combined, however, they produce incoherent outcomes. Any party that hopes to win at the federal level must perform well in the very different circumstances in the East.
This article addresses how recent German films depict unification, placing special emphasis on the question of cinematic time. In contrast with Germany's most internationally successful films about the East German past—including Das Versprechen (1994), which emerged in the un-reflected moments not long after the fall of the Wall, Das Leben der Anderen (2006), which portrayed daily life under the shadow of the Stasi, and even Good Bye, Lenin! (2003), which depicted the period immediately following the fall of the Wall—and with the intention of identifying an alternative mode of depicting the GDR past, this paper explores a post Wende cinema of disillusionment. It examines: the revaluation of the time of unification itself in Oskar Roehler's Die Unberührbare (1999); the time of demission subsequent to unification as portrayed in Robert Thalheim's Netto (2004); and, the forsaken time of the postunification present as depicted in Christian Petzold's Yella (2007). The article provides an overview of this cinematic tendency, and comments specifically on how these three films represent the difference between the passage of historical time and its subjective experience.
A Research Report
Werner Pfennig, Vu Tien Dung, and Alexander Pfennig
On 3 October 1990, Germany achieved formal unification. Even 27 years later, however, inner unity has yet to be completed and there are ongoing discussions about the overall costs. This is a widely debated topic in many countries, but especially in
Jeffrey J. Anderson
Twenty years after all the excitement, Germans seem to be genuinely of two conflicting minds about unification. One is characterized by awe over the accomplishments of 1989-1990, the other by disappointment and even bitterness over unfulfilled ambitions and promises. These contrasting interpretations and assessments of unification are fluid, but surface repeatedly in the quality print media. This chapter examines the recurring themes, interpretations, and narratives about unification twenty years on, and seeks to trace the interconnections between the social, economic, and political dimensions of unification. As such, these contemporary printed narratives can tell us a great deal about how a people views its recent past, what its priorities are, and how it is facing the future. The analysis reveals that public discourse on unification twenty years after the fact resembles a blind spot—look straight at it, and it disappears, replaced by blank spot—a seemingly irreducible gap between East and West. Avert one's gaze, and the spot fills in, almost seamlessly.
Since German unification there have been dramatic and highly visible changes in the German financial system and relations between banks and firms in Germany. The traditional Hausbank system has weakened, as securities markets have become more important for both borrowers and savers. The demands of financial investors on how German firms manage themselves have—for better or worse—become increasingly influential in this time. In this article, I advance the thesis that bank-industry relations in Germany became increasingly differentiated, with one set of firms moving into an institutional environment readily characterized as market-based finance. Meanwhile, most German firms remain in a bank-based environment that, while not quite the same as the Hausbank model that prevailed at the time of unification, is still easily recognized as such. These changes in the financial system have had numerous consequences for the German economy, including increased pressure on firms to make greater profits and increased pressure on labor to limit wage gains and make concessions in the interest of corporate competitiveness.
Michael Sutton, France and the Construction of Europe 1944–2007 (Oxford: Berghahn, 2007).
Tilo Schabert, How World Politics is Made: France and the Reunification of Germany, trans. John Tyler Tuttle (Columbia: University of Missouri Press, 2009).
Frédéric Bozo, Mitterrand, the End of the Cold War and German Unification, trans. Susan Emanuel (Oxford: Berghahn, 2009).