2024-07-11 10:23:31
The Munich-based Ifo Institute has warned of the economic impact of reintroducing conscription. Depending on the scenario, a decline in economic output could be expected.
Compulsory military service or more funds for the Bundeswehr? According to the Munich-based Ifo Institute, the latter makes more sense. The experts warn of the economic impact of reintroducing compulsory military service. Depending on the scenario, Germany’s economic output could fall by up to 70 billion euros, the researchers said on Wednesday. It would therefore make more sense to provide the Bundeswehr with more funds to make it more attractive as an employer.
In June, Federal Defense Minister Boris Pistorius (SPD) presented a new model for the systematic examination of young men to determine their suitability for military service. However, this does not envisage a return to conscription. Rather, the focus is on compulsory registration and needs-based conscription – there is no obligation to perform the service. At the same time, however, the introduction of compulsory service is also being discussed.
On behalf of the Federal Ministry of Finance, the Ifo Institute has now examined three different scenarios. If the obligation applies to everyone in a given year, economic output would fall by 1.6 percent and 70 billion euros. If, as was the case with compulsory military service, which was suspended in 2011, around a quarter of people were called up for military or civilian service, the decline would be 0.4 percent or 17 billion euros. If only five percent of a year is affected (similar to Sweden), the researchers estimate the decline to be 0.1 percent or three billion euros.
The costs arise primarily because young people start to build up human capital and wealth later. Instead, the researchers recommend paying higher salaries to those doing military service to make them more attractive. Although this would place a greater burden on the state budget, the overall economic costs would be almost half as low as with compulsory military service.