While it is true that Germany is far more competitive than their southern European neighbours, however reports of industrious, free-market activity between the Rhine and the Oder have been unfortunately exaggerated by English language media looking for a hero vis à vis the profligate Greeks. Truth be told, Germany's future may look a lot like Japan's unless they do more to encourage business growth. And by encourage, I mean they need to take their army of bureaucratic regulating machines and send them away for a few months so they can't get their grubby little hands in every piece of pie they see. It doesn't take an advanced degree in economics to figure out why allowing the public sector Nein-aholics a free hand to decide how private businesses are run is a recipe for failure.
Tuesday, 25 May 2010
Reports of my life are greatly exaggerated
According to this article from last year, Germans are officially "risk shy" when it comes to starting their own business. Somehow I'm not surprised. I have never seen a country so obsessed with preventing every unforeseen eventuality to the point of failing to leave the safety of one's own toilet. Economically, Germany operates on a type of low-to-no competition mercantile system in which the barriers to market entry are artificially high to protect older businesses from young upstarts. For all intents and purposes, the country still has a type of guild system in place that severely restricts labour market flexibility and stifles entrepreneurial innovation.