Paradigm Change in the Face of the World Financial Crisis? : A Comparative Study of the Economic Policy Debates during three economic slumps in Germany

In 2008-2009, a severe economic crisis struck the world economy. Many macroeconomists assumed that the global financial crisis would change the prevalent way of economic thinking. This paper considers this idea and raises the question if a paradigm change in the German debate on macroeconomic policy has occurred. To this end, the paper analyzes and compares the macroeconomic policy recommendations of the most important German macroeconomic reports – Sachverständigenratsgutachten and Gemeinschaftsdiagnose – during the course of three economic slumps, including the 2008-2009 global financial crisis. The comparison shows that – notwithstanding that some minor changes in economic policy took place – there has been no paradigm change in the economic policy debates since the 2008-2009 world crisis. The absence of a significant change in the policy concepts raises the question of why there is such a high stability of the approaches of the two reports. It is suggested that the institutional context in which the expert discourse is embedded contributes to this stability.