The German Automobile Industry and the affect it has on the German Essay - 1

The German Automobile Industry and the affect it has on the German Economy, Stock Utility Analysis - Essay Example With 121 billion EUR, the German car industry earned 60% of its sales in foreign countries. German car manufacturers and suppliers employ more than 1.5million people worldwide, more than half of them in Germany. Recently, domestic employment has been expanded; Since 1994, the number of jobs at home increased by122000.Despite economic weakness in 2002, employment in the car industry remained almost constant with 763 500 people. Owing to the assumption of additional value-added activities from the manufacturers, suppliers even employed additional staff. The German car industry employs more than 12.8% of the working population of the whole German industry. At the same time, it raises one third of the R&D expenditure of the German economy and one-fifth of the investments. During the last five years, 49 billion EUR were invested in Germany; over this period of time, expenditure for R&D exceeded 65 billion Euros, and the R&D staff was increased significantly to more than 70,000 employees (VDA, 2003). Literature Review: Germany was one of the European countries that succumbed early to the fascination of Fordist production methods. German automakers made pilgrimages in the 1920s to the USA, seeking to discover the secrets of the economic future at the holy cities of capitalism, which of course included the Ford plants at Highland Park and River Rogue. Creating the preconditions for a new age in automobile production was a strong motive behind numerous efforts to concentrate car production capacity in Germany. After the postwar stabilization of the economy, the large German banks - above all the Deutsche Bank - toyed with the... Robert Merton (1987), "On the Current State of the Stock Market Rationality Hypothesis," in Ruddier Dornbusch, Stanley Fischer, and John Bossons, eds., Macroeconomics and Finance: Essays in Honor of Franco Modigliani (Cambridge, MA: M.I.T. Press).