"The German high-skills/high value-added economy has long been the Mecca for supporters of the European social model. So long as Model Deutschland was thriving the notion of Social Europe was a plausible political project. But Germany is facing a range of economic problems—the aftershock of reunification, high unemployment and internal and external pressures to reform its stakeholder system of economic organisation. Some of these developments strike at core assumptions of the German model. This article reviews the extent to which the German model is in danger and teases out the implications for the wider European economy."

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