The analysis of the annual economic reports was required in order to examine Germany’s economic and innovation policy during 2010, 2011 and 2012. This also encompassed every type of public funding initiative on the federal level for SME investments, innovation projects, enterprise founding, equity financing and, furthermore, the research subsidies ZIM and KMU- innovativ (see table 25 in section 5.6.1).
In order to understand this part of the analysis, several theoretical aspects must be considered. The issue of the PE and VC market has already been embedded in a neo-institutional perspective, which was also regarded as suitable to describe and to explain the issue of public funding (see section 3.3). Economic policy and innovation policy are treated separately and therefore the unquestioned application of a neo-institutional theoretical framework seemed inappropriate. In order to describe and to explain the economic and innovation policy, and in order to operationalise the analysis process, an alternative theoretical framework was required. In that regard, the subsequent paragraphs are concerned with theoretical clarifications of both economic and innovation policy, and the development of a theoretical foundation. This section finally details the application of the theoretical framework of the present examination.
In order to comprehend the specific subjects of economic policy, this initially requires the differentiation between a theory of economic policy and an economic theory. The latter is focused on the description of the economy and is the basis for the theory of economic policy. The theory of economic policy in the majority of directions tries to infer normative recommendations about a desired state. Hence, the theoretical part of economic policy, which is focused on the current economic political status quo, transforms the theoretical results into recommendations for practice. On the other hand, economic political theorisation is also
concerned with the description of the current state in order to infer future behaviours of decision makers (Neck and Schneider 2013). The present thesis is neither concerned with the assessment of the current political measures, the inference of normative recommendations nor with future projections. This thesis is solely concerned with the description of economic policy during the financial crisis. The procedure in that respect resulted in the inference of Germany’s political strategy in relation to existing economic political theories. Therefore, both a suitable analysis framework and a category system were required in order to select economic political measures and to derive the final strategy of the government. This basic framework was aligned on the specific subjects of economic policy (Neck and Schneider 2013).
Economic policy by definition is every measure in order to structure, to navigate and to organise an economy (Wildmann 2012). In terms of a functional structure, economic policy is concerned with governance measures and thus regulatory policy, process policy and structural policy (Neck and Schneider 2013). Regulatory policy by definition establishes the framework for economies and in free market economies, regulatory policy is always concerned with competition policy. Process policy on the other hand is the direct application of specific measures to align the economy on growth. Finally, structural policy is concerned with the support of specific sectors or regions (Wildmann 2012).
This basic structure is surely to broad in order to derive a specific type of economic policy, which is considered as multi-paradigmatic sciences with different theoretical orientations (Neck and Schneider 2013). Neck and Schneider (2013, p. 50) in that context point out that it would be overall difficult to structure economic policy, not only with regard to its functions, but also with regard to its instruments and objectives.
A less abstract but more detailed dimension according to Wildmann (2012) is focused on the following subjects:
conjuncture policy; distribution policy; employment policy; environmental policy; foreign trade policy; finance policy;
monetary policy; social policy.
Even though this categorisation system suffers from overlaps too, it seemed suitable as a foundation for an analysis framework. The subjects of employment policy, foreign trade policy, distribution policy, environmental policy and social policy were excluded in the present examination even though some of their aspects overlap with regard to conjuncture policy. The remaining subjects of monetary, conjuncture and finance policy were applied on the examination material. This means that laws, law initiatives or other campaigns and promotions on the federal level which came into force or were proposed during the post-crisis phase were analysed in accordance with monetary, conjuncture and finance policy in Germany. This examination was focused on the most important political initiatives which required the subjective differentiation from the less important political initiatives.
Regarding the institutional level, economic political decision making is realised by public and hence state institutions. In accordance with Germany’s federal system, political decision making is realised by the governments, the parliaments and the courts, each on the federal level, the federal states level and the local district level. This perspective on public institutions encompasses every public organisation which supports the political decision making process or which is directly responsible for political decision making. The public decision making process is supported by private organisations such as employer’s associations or unions. Moreover, public subsidised economic research institutions participate in the decision making process. Nevertheless, they are not classified as authorised public decision makers (Wildmann 2012). The present examination is solely focused on the federal level of public decision making. This perspective encompasses the supranational level (Wildmann 2012) and in that respect the European level.
The subsequent figure two summarises this basic analysis framework regarding the economic policy in Germany.
Figure 2 The basic analysis framework (own development)
This framework (see figure two) is not derived from a specific theoretical perspective but rather from the subjects of economic policy. Hence, this part of the examination was not carried out in relation to a specific theoretical lens, for example Keynesianism, Monetarism or the Neoclassic. This part of the examination rather went the opposite direction in order to determine the specific type of economic theory behind the economic policy during the financial crisis.
The innovation political strategy on the other hand was examined according to Schumpeter’s conjuncture theory, which argues that both invention and innovation would be required for further economical progress (Wildmann 2012 and section 2.6.1). Therefore, the issue of innovation policy was examined in the context of economic policy during the financial crisis. As the specification of the innovation policy is mainly derived from the research reports, the description of innovation political concepts is realised in the subsequent section 5.6.4.
Due to the focus on the central elements of Germany’s economic and innovation policy, an exploratory summary or the inductive category development according to Mayring (2010) seemed inappropriate. Therefore, the material was analysed according to rather open examination areas which were derived from the framework in figure two. Text phrases which addressed the respective examination area were finally summarised according to each examination field. This procedure is defined as a structured content analysis according to Mayring (2010).
1. Examination perspective:
a) political decision making in Europe; b) political decision making in Germany. 2. Analysis areas:
a) monetary policy;
b) conjuncture and growth policy; c) finance policy.
3. Governmental measures: a) laws;
b) law initiatives; c) promotions.
The analysis of the economic reports was focused on their summary section in part one and on the appendix of each report. The summary of the reports describes the past economic development, presents the governmental forecast, the past legislation and the future intentions of the government. Part one of the reports is sub-divided into several sections which are for instance concerned with economic, competition or financial political measures. These sections are structured along consecutively numbered paragraphs which are each focused on a particular sub-issue along the main topics. Part one of the economic reports includes additional clarifications with regard to specific incidents, legislations or other initiatives both on the European and German level. These clarifications, beside additional statistical indications, are integrated in colour-coded boxes. Part two of the reports, which presents the economic forecast of the government, was not part of the present analysis. The appendices of the economic reports each schedule legislative initiatives, the legislation of the underlying year and other promotions or deed polls on the federal level (BMWi 2011; BMWi 2012; BMWi 2013).
With regard to the development of a category system, it was avoided to apply a narrowed classification. Therefore, the text material was initially analysed roughly along the so-called guiding questions (Kempf 2008). A more detailed category system according to the guiding questions was then applied along the summarised text material. If required and appropriate, the category system was adjusted during several examination runs (Kempf 2008; Mayring 2010). The smallest code unit in the text was one paragraph and the biggest code unit was one numbered text section. A text section consists of at least one or in some cases of several paragraphs, whereas one paragraph consists of several sentences. Coding each sentence seemed inappropriate, as the explanation of a particular subject is associated with at least one paragraph. The indications in the colour-coded boxes were also coded along the category system. In addition, the statistical information in the tables, the indications in the diagrammes and in the figures were considered too in the case the content contributed to the subject area.
The guiding questions for the economic reports
No. Guiding question Code
1. Indications regarding European economic policy? 01
2. Indications regarding economic policy in Germany? 02
3. Indications regarding public funding in Germany? 03
Table 31 The guiding questions for the economic reports (own development)
Text sections which addressed the specific guiding question were coded and finally summarised under each subject. This procedure allowed for a further detailed classification of the text content along following category system (see subsequent table 32).
The category system for the economic reports
No. Examination category Code
1. European economic policy. 01A
2. European finance, conjuncture and monetary policy. 01B
3. European innovation policy. 01C
4. German economic policy. 02A
5. German finance, conjuncture and monetary policy. 02B
6. German innovation policy. 02C
7. Public funding in Germany for SMEs. 03A
8. Public funding in Germany for innovation projects. 03B
9. Research subsidy ZIM. 03C
10. Research subsidy KMU-innovativ. 03D
11. Public funding in Germany for enterprise founding. 03E
12. Public funding in Germany for equity investments. 03F
Table 32 The category system for the economic reports (own development)
The following examples (see subsequent table 33) describe the application of the category system along part one of the economic report 2011 (BMWi 2011).
Example I of category systems application
Paragraph Subject of the numbered paragraph in part one Code
23 Germany’s dynamic economic growth. -
26 Germany’s dependence on the world economy. -
28 Economic political strategies after the crisis. 02A
46 Public household consolidation in Germany. 02B
48 Germany’s future agreement. 02B
50 Reorganisation of local districts financing. -
Table 33 Example I of category systems application (own development)
The more detailed coded text phrases were finally summarised under each category according to the summary procedure of Mayring (2010). This, inter alia, means that non relevant sentences or double indications were deleted and unclear text phrases were explicated. The category system was finally applied on the additional indications in the colour-coded boxes, the tables and the diagrammes. This process is described in the subsequent example (see subsequent table 34) which is based on the content of the economic report 2011 too (BMWi 2011).
Example II of category systems application
Box no. Subject of the text element Code
2 Causes, effects and perspectives of Germany’s export. -
4 Implementation of the future agreement in the public budget law 2011. 02B
7 Core objectives of the European-2020-Strategy and national aims. 01A
Core objectives of the European-2020-Strategy and national aims. 02A
Table 34 Example II of category systems application (own development)
The results of these analyses were integrated in the summary, in case this expanded the initial findings. Finally, the analysis was concerned with the governmental measures in the appendix of the economic reports. The measures are consecutively numbered and hence the smallest and also the biggest code unit were each one specific governmental measure. The measures were also coded along the category system in table 32. Governmental measures which are concerned with the development of Germany’s eastern part, development political measures, the funding of enterprise founding in the scientific environment and every type of advisory grant were overall not taken into account. The subsequent table 35 describes the application of the category system along the governmental measures in the appendix of the economic report 2011 (BMWi 2011).
Example III of category systems application
No. Governmental measure Code
2 Qualification during short-time employment. -
7 Adjustment of the tobacco tax. -
20 Adjustment of the company law. -
25 European-2020-Strategy. 01A
70 Prolongation of the agreement for research and innovation. 02C
72 Modification of the research subsidy ZIM. 03C
73 Modification of the research subsidy KMU-innovativ. 03D
76 Germany’s digital strategy 2015. 02C
88 Energy efficiency fund. RC
98 Innovation alliance photovoltaic. 02C
Table 35 Example III of category systems application (own development)
The coded initiatives were finally summarised along the categories and integrated in the initial analysis of the economic reports. Governmental measures in the residual category, which were classified as RC, were reviewed in greater detail by means of explication (Mayring 2010). In case that their final classification was not possible or appropriate due to a minor relevance, these measures were excluded from the examination. The selected measures were scheduled, which included a brief description.
The final results are presented for each economic report in an annual sequence. In order to achieve a fluent transition between the initial phase of the financial crisis and the post-crisis phase, the analysis started with the review of the economic report 2010 (BMWi 2010).