Labor Market Effects of Economic Integration: The Impact of Re-Unification in German Border Regions

This paper exploits the significant reduction in impediments to labor mobility in the process of German re-unification in order to identify labor supply shocks in the West German labor market. The focus is on the quasi-experiment of the border removal in the regions situated at the German-German border that faced a massive increase of cross-border labor supply. The results indicate that despite a gain in employment, the border removal was accompanied by a decline in wages and an increase in unemployment relative to other West German regions. Copyright Verein für Socialpolitik and Blackwell Publishing Ltd. 2007.

HEALTH CARE POLICY IN THE GERMAN SOCIAL INSURANCE STATE: From Solidarity to Privatization?

Statutory health insurance is a centerpiece of the German welfare state, which considers itself to be a "social insurance state." At the same time, due to a large volume of interpersonal redistributions that occur in health insurance, it is the most ambitious branch of the country's social insurance system. The stability of the health scheme thus depends on a "culture of solidarity" to maintain the legitimacy of these redistributions. This article analyzes recent changes in the legislative framework of the statutory health insurance. It asks whether these changes which predominantly aim to contain employers' nonwage labor costs by making the insured bear a larger share of total health care spending, are possibly weakening the moral infrastructure of the welfare state. To this end, findings from qualitative interviews with insured persons are evaluated in view of recently approved and currently proposed legislative changes to the health scheme. The analytical focus is the question whether the two equity principles of this scheme, delivering health care according to medical need and financing it according to the "ability-to-pay," are becoming endangered. Copyright 2002 by The Policy Studies Organization.