FRG Economy Flashcards
Gastarbeiter numbered .. in 1959, and how many in 1966? What percent of the workforce were they in the 70’s?
150,000
1.2 million
10%
In the era 1961-1966 what was unemployment?
Kept below 1%
what happened in 1965
economic slump, europe wide phenomenon but this caused widespread fear
underlying problem of the 60’s?
falling back from post war boom and declining growth rates.
What did Schiller and Strauss do in 1967 to encourage more active gov to restore confidence
Stabilisation Law 1967 ; allocate special funds to infrastructure ; constitution change to make spending + tax policy state > lander, increase taxes, spending cuts 2000 mil DM, concerted action
60’s… when was budget balanced, when was unemployment down and what was inflation down to in 1969?
1967 = budget
1968 = unemployment going down
1969 = inflation down to 1.5%
What treaty was signed in 1951? What did this make?
Treaty of Paris; merged coal iron and steel industries of Europe = ECSC. Function 1952
What did the FRG also join in 1952?
International Monetary Fund
1957 Treaty of Rome?
Made the EEC which the ECSC merged into.
What did members of the EEC do?
Common policies on agri, transport, labour and common external tariffs.
What was proof EEC was good?
By 1968, all internal tariffs removed.
Value of trade between members 1958 to 1968 increased 4x
What happened in 1974?
First serious recession.
What was going on 1971-1973
Rising inflation and cost of imports steady rising
End of 1973.. who did what?
OPEC doubled the price of crude oil - hadn’t happened since 50’s = economies relied on cheap fuel.
How much more did the FRG have to pay for imports after the ‘73 oil crisis?
17 billion DM more.
What happened to the countries balance of payments after 1973?
1973 surplus of $9.5 million, within a year, deficit of $692 million
January 1974, despite balance of payments crisis, unions still…. Example?
demanded higher wages, jan 1974 union for public employees for an 11% pay increase
What did Schmidt do to bring inflation down?
Expenditure cuts, increase VAT, proposed creation of EMS which would fix exchange rates in Europe = DM replace $ in Europe
What happened 1979? Impact?
Shah of Iran overthrown, oil price increased 150% more
Impact 2nd Oil crisis?
Unemployment soared to over 2 million and recession until 1982
By 1983 economy recovering, how?
export led growth strategy, rapid technological modernisation and good industrial relations all increased productivity
What did Kohl Continue to subsidies?
Coal , farming , steel and kept paying high welfare
When did oil prices fall?
1985 and exports recovered.
Inflation in 1981? 1986?
1981 = 6.2%
1986 = 0.6%
