The Impact of the 2008 Economic Crisis and Post-Crisis Policies on Inequality in the United States and Germany

Abstract

This thesis explores the multifaceted impacts of the 2008 financial crisis on economic inequality, focusing on the comparative analysis of the United States and Germany. Specifically, it scrutinizes the implementation and consequences of the Troubled Asset Relief Program (TARP) in the United States and the Financial Market Stabilization Act (FMStG) in Germany. The study evaluates the policy impact and contributes to understanding how government actions can influence economic disparity and inform future decisions. Moreover, the research delves into how these crucial interventions not only aimed at stabilizing the financial systems but also how they inadvertently affected social equity across different demographics. Employing the theory of social equity as a lens, the research critically assesses the alignment of crisis management policies with the principles of fairness and intergenerational justice. It investigates whether these interventions provided short-term economic relief at the expense of long-term social inequality. Furthermore, the analysis extends to the role of government actions in shaping the distribution of economic opportunities and burdens during and after the crisis. The thesis also considers the broader implications of these policies for future generations, exploring how decisions made during times of economic distress can set precedents that affect subsequent policy formulations aimed at mitigating economic disparities. By examining the balance between market regulation and social equity, especially across generations, the research offers insights into how the U.S. and Germany addressed economic challenges and fairness during the crisis. Through a detailed examination of policy outcomes in both countries, this study contributes valuable insights into the dynamics of economic policy and social equity, offering recommendations for crafting more equitable economic policies in the face of future financial crises.