Prof. Dr. Moritz Schularick

According to the Kiel Institutes latest forecast, Germany's path out of the economic slump takes more time, with a moderate recovery setting in later this year. Economic output is likely to shrink in the winter half-year and will barely more than stagnate in 2024 with GDP increasing by 0.1 percent only. The Kiel Institute has thus markedly revised its expectations downwards by 0.8 percentage points. Reasons: Private consumption and exports are recovering later and less dynamically, and corporate investment spending is also weak. Next year’s GDP is expected to grow by 1.2 percent. Inflation is expected to fall to below 2 percent and the fiscal deficit to below 0.8 percent.

What are the economic costs of wars, how are they composed, and who bears them? A new study by the Kiel Institute, based on data from more than 150 wars since 1870, shows that the costs are highest for the country in which the war takes place. Buildings, machinery, and infrastructure are destroyed, and growth slows for several years. Yet, war neighbors also pay much of the cost of war as they suffer from higher inflation and decreased output growth. Experience from past wars suggests that Ukraine will lose about USD 120 billion in economic output (GDP) and almost USD 1 trillion in capital stock by 2026. Non-belligerent third countries are expected to face output losses of about USD 250 billion, USD 70 billion of which are borne by the European Union alone.

Residential real estate prices witnessed 2023 the largest drop since the beginning of systematic real estate price recording in Germany about 60 years ago. This applies to all residential segments–apartments, single-, and multi-family houses. This is shown by the latest update of the German Real Estate Index (Greix) with data for the 4th quarter, in which the price decline did not continue to the same extent. The Greix is a joint project of the local expert committees (Gutachterausschüsse), ECONtribute, and the Kiel Institute. The index is based on transaction datasets from the expert committees, which rely on notarial certified contracts. Currently covering 19 cities, all data is openly accessible at www.greix.de.

The Kiel Institute is hosting a MSC Conversation on the "guns versus butter" question at the Munich Security Conference 2024.

Rigorous research on the link between economics and geopolitics remains scarce. This joint conference will bring together world-leading scholars working at the intersection of geopolitics and (international) economics.

This conference brings together recent research on the economics of Artificial Intelligence. It is is jointly organized by the Hertie School, IZA, the Kiel Institute, and Sciences Po, in collaboration with the CEPR.