Ordnung muss nicht sein. Developments on the German political scene. OSW Commentary No. 55, 2011-06-27

The results of parliamentary elections in seven German federal states, ongoing since early 2011, show the collapse of the existing order on the German political scene, both on a national level and on the level of the individual federal states. So far, the federal states have been governed by one of the catch-all parties1 – i.e. the Christian Democrats or Social Democrats – in coalitions with smaller partners – the FDP and the Greens, respectively2. This year’s elections have fully revealed the extent of social transformation in Germany and its impact on voting preferences and the hitherto stable party system in this country. The largest and most popular parties so far – the CDU and the SPD – are losing the voters’ confidence and support, whereas the parties associated with protest movements (such as the Greens) are gaining prominence. Moreover, the German political scene is undergoing increasing fragmentation, as new small, local groups are appearing who have no political aspirations at the federal level but who are attractive to voters acting as successful groups of common cause. The changes in the existing balance of power on the German political scene are being sped up by the specific features of the federal system. Elections to the parliaments of the federal states are held at regular intervals which increasingly affects policies on the national level. The key decisions that concern domestic and foreign affairs are made under the pressure of constant election campaigns.

Simulation Results of AgriPoliS about Diminishing Capital Subsidies and Restrictions. Factor Markets Working Document No. 55, June 2013

This paper investigates the impacts of high interest rates for borrowed capital and credit restrictions on the structural development of four European regions. The method used is the model AgriPoliS which is a spatial-dynamic agent-based model. It is able to provide aggregated results at the regional level, but very individual results as well by considering farms as independent entities. Farms can choose between different investment options during the simulation. Several scenarios with different interest rates for borrowed capital on the one hand as well as with different levels of credit restrictions on the other hand are tested and compared. Results show that higher interest rates have less impact on declining production branches than on expanding ones. If they have the possibility farms invest in the most profitable production branch which relative profitability might have changed with high interest rates. Credit restrictions lead farms to choose smaller and cheaper investments than expensive and large ones. Results also show that income losses in both cases due to under-investment compared to the reference situation are partially compensated by lower rental prices. The impacts on structural change also differ depending on the region and the initial situation. In summary, credit subsidies or imperfections on credit markets might have indirect impacts on the type of dominant investment and therefore on the whole regional agricultural sector as well.