Studies of Economic Change

Forecast

The forecast of the unemployment rate is based on the trends of the past. As mentioned before it has to be admitted that the basic figures do not suffice to academic demands or formalism. But despite this they are exact enough to say that from the end of the 50th to the beginning of the 90th of the last century the growth of the labour productivity related to the annual hours worked is about 0.6 to 1.0% higher than the growth rates of the gross domestic product. If we consequently realise that the labour productivity determines the international competitiveness we would come to the conclusion that it is therefore necessary allocate all resources to increase the efficiency. Due to this we can calculate with growth rates of the labour productivity which are about 1.0% higher than the growth rates of the gross national product as they are expected to decrease. As it is not realistic that the labour productivity increases limitedness the forecast assumes a linear increase of about 0.80 Euro for each working hours which is in 1995 1.8% and in 2050 1.1%. The gross domestic product is expected to increase by about 400 Euro for each capita which is in 1995 1.8% and in 2050 0.9%.

• The "law" of diminishing marginal utility is considered by a percentage declining but absolute constant growth rate of the gross domestic product.
• The idea of the evolution theory is considered by a productivity rate which is about 1% higher than the economic growth rate at the beginning and remains then at the same level in absolute figures.

Political passivity as basic assumption

The red line in the graphic reflects the development of the basic forecast from 1995 while the green line shows the matching with the actual unemployment figures. The cause for the deviation is explained on the following page.