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High consumption, usually, eventually leads to investment. Germany has had a lot of bad investments, especially in infrastructure. Stimulating the economy by in
by egeozcan 2y ago
High consumption, usually, eventually leads to investment. Germany has had a lot of bad investments, especially in infrastructure. Stimulating the economy by increasing the government spending is usually not the worst idea, as it will let the market decide on what to invest.
The opposite seems to be working in Argentina, sure, but I always quote Kuznets when it comes up: "there are 4 types of economies: developed, undeveloped, japan and Argentina".
As someone who studied economics and is doing wildly different things, I'm looking forward to see how the "DOGE" thing Elon is doing will change things. I bet it'll be for the worse, but there is a reason why I didn't become an economist at the end :)
- holowoodman 2y agoConsumption in Germany means spending on social amenities such as unemployment benefits (no time limit, no more obligation to get a job or even show up for interviews) and stuff like that. That kind of government spending does not lead to any meaningful investment.
- kranke155 2y agoYou don’t even have an obligation to go to interviews ? Why not?
- holowoodman 2y agoWell, technically you do. But the late left-wing government decided that sanctioning people (usually decreasing their payments) for not fulfilling their obligations is "socially cold", so they ended all sanctions. Meaning that you can ignore that obligation and still get the full amount of money.