Analysis of the Macroeconomic Impact of the CSF on the Economy of East Germany, Report No. 30

The authors' main objective in this project is to study the options available to East Germany as it faces into the need to design policies that will take it from the immediate post-transition situation towards the EU average standard of living. After the initial transition, East Germany had a relative standard of living roughly comparable to that of the EU cohesion countries immediately prior to their entry into the EU. To reach the EU average, it must, therefore, grow for a sustained period at a rate higher than the EU average, or become permanently dependent on subvention from the former West Germany. Our modelling activities are designed to provide tools to facilitate an exploration of the options and likely outcomes.