10 % since 1993, it is a precise quantification of this difference is not easily possible, since the forecasts of future developments are also of importance for estimates at the end of the series. for example, the oecd currently assumes a potential growth of the us economy of 3½ %, whereas the imf predicts 2¾ %. only in the last two years that germany has seen a recovery of investment in machinery and equipment, albeit not with double - digit rates of growth ( 1998 : 9. 2 %, 1999 : 5. 1 % ). 4 if the different pace of economic growth is examined more closely, it becomes apparent that us output growth is supported by a sharp increase in both employment and in labour productivity. this is a strong indication that a balanced growth process is existing, in which labour and capital complement each other in terms of their contribution to output. with an average growth rate of 2 %, labour productivity in germany was quite close to the us figures in the nineties. 5 when analysing this development, however, it has to be remembered that the productivity gains in germany are also attributable to a fall in employment. the contrasting developments in labour productivity and employment point to an extensive substitution of labour by capital. it is, of course, not sufficient to look only at the highly aggregated level. 6 the oecd comes to the conclusion that the development towards a services society has also made considerable advances in germany : in a comparative study, it puts the share of “ knowledge - based industries ” in the united states and in germany at just over 50 % in each case. 7 and within the category of investment, as in the united states, investment in software shows by far the highest growth rate in germany. 8 the pioneering role which the united states has assumed in the development of new technologies is, however, likely to be unchallenged. a study by the munich - based ifo institute on the spread of new information and communication technologies, for example, concludes that generating such technologies has not been a very prominent feature in germany over the last decade as compared to the united states or japan. 9 this finding is broadly consistent with oecd studies on investment in r & d activities in the industrialised countries : whereas the share of these expenditures as a percentage of gdp declined in germany during the nineties, it has been rising again in the united states over the past few years following a decline in the early nineties. 10

venture capital into risk capital traded on the stock exchange following the phase of venture financing. in the past, the lack of such an “ exit ” option was one of the obstacles to the development of a broader venture capital market in germany. the rapid growth of the stock market would not have been possible without the general public becoming increasingly interested in share investments. much use is being made of indirect stock market activity through investment funds. complementing the provision of risk capital via the stock market, there has been a sharp rise in the issue volume of corporate bonds. this instrument was also used in the past year to finance mergers and acquisitions - in other words, the restructuring of the corporate sector. however, this increase is also due to growing investor demand for higher - risk paper, since the scope of diversification has become much smaller through the elimination of exchange rate risks following the introduction of the euro. the german corporate bond market is still less developed than in the united states. however, there are indications that the emergence of corporate bonds as a means of long - term financing has become increasingly prominent in supplementing the use of bank loans. the momentum and strength of such an underlying trend seem to be influenced to a large degree by technological advances, the pace of structural change in the corporate sector and economic policy reforms, such as in tax law or old - age pension provisions. additional impetus is being provided by european monetary union. ladies and gentlemen, let me finally return to my initial question : “ is there a new economy in germany? ” this question cannot be answered with a sweeping yes or no. but it can probably be stated firstly that there are movements in germany which are simultaneously beneficial to growth and price stability. i see traces of such a new economy, above all, in areas of the economy which for a long time were subject only to limited competition, but which are now being deregulated. more growth in those areas may even be accompanied by falling prices. second, the new technologies are available globally. they are also available as growth potential outside the united states. third, the german financial system seems well equipped not only to accommodate the changes in the real sector but also to support them. in germany, we need and have both market - oriented and bank - oriented financial services. i cannot and do not want to comment on the development of share prices in the new market in germany. but i do believe that traces of a new economy can also be found in this market segment. on top of that, ever