The export world champion

Germany’s international competitiveness, a significant part of which is due to its boom in exports, has been a crucial component in the transformation of Germany from the sick man of Europe to the continent’s apparent economic superstar. However, despite this remarkable success, it would be a mistake to ignore the fact that Germany has a dual economy, one wherein the services sectors have had and continue to have major problems, the most significant of which being that productivity, investment, and wages remain low. The present chapter discusses Germany’s dual economy and the flip side of Germany’s success as an exporter.