O.k., from the point of view of scientific economics it's a joke. But every good joke contains a true core. The dsvECO-stabilometer is a simple measure for the performance of stabilization policy. We monitor four targets (inflation, unemployment, the relation current account to GDP and the relation of the stock of public debt to GDP) and calculate a quadratic loss-function. The target values are 2.0 % for inflation, 1.0 % for unemployment, 0.0 % for the current account and below 60 % for public debt. The first three targets are common and codified in the 1967 Stabilitäts und Wachstums Gesetz (law for stability and growth). The last target stems from the Maastricht-accord and the 1997 growth and stability pact of the EU. For simplicity we assume the same weights for all targets. The higher the stabilometer, the worse the results of stabilization policy.

1992 to 1995 under chandellor Kohl the results of stabilization policy improved and stayed quite unchanged until 1997. In 1998 the stabilometer shows a slight worsening of the results of stabilization policy and chancellor Kohl lost the election to Mr. Schröder. From 1999 to 2001 the stabilometer shows an improvement of the results of stabilization policy and chancellor Schröder was re-elected. 2002 to 2006 the results worsened and chancellor Schröder called an early election before the results got to bad but was replaced by Mrs. Merkel in 2005. From 2006 to 2008 the stabilometer shows an improvement of results. As fiscal policy used deficit spending to fight the Great Recession in the aftermath of the financial crisis of 2007 and public debt increased reasonably above the 60 % limit of Maasticht. As a result the stabilometer shows a steep increase. the increase in public debt. After 2010 with a constitutional debt brake public debt was reduced, documented in a substantial improvement of the stabilometer. But in 2017 it is still above it's values before 2001.

The dsvECO-stabilogramm shows the shares of the components of the stabilometer. It gives an impression which target is relatively offenced most. The result is striking: Until 2006 employment is the most-missed target with a peak in 2001. Afterwards with effectful labour-market reforms unemployment is reduced. Inflation plays a little role only during the 1990s and from 2014 to 2016 when the inflation-rate was substantially below it's target-value. The current account contributs substantially to the losses in all years. 2009 to 2015 public debt poses the biggest problem and is reduced after the debt-brake is introduced. Since 2016 the external ballance again is the most serious problem for stabilization policy.

Source: Statistisches Bundesamt, Deutsche Bundesbank, Institut für Arbeitsmarkt und Berufsforschung, own calculations