53 © The Author(s), under exclusive license to Springer Nature Switzerland AG 2020 A. K. Koźmiński et al., The Balanced Development Index for Europe’s OECD Countries, 1999–2017, SpringerBriefs in Economics, https://doi.org/10.1007/978-3-030-39240-6_3 Chapter 3 Successful and Unsuccessful Reforms: Germany, Greece and Spain 1 Special Socio-Economic Reforms in Germany in 1999–2017 Our data on socio-economic development allow the special cases of Germany, Spain and Greece to be examined. In all these countries reforms were undertaken to restore compromised equilibria. Germany provides the most spectacular example of a suc- cessful reform (Fig. 3.1). At the beginning of the analyzed period, Germany was characterized by a low rate of economic growth, the average of which was 1.6% in 1995–2001, well below the average for the EU countries. Throughout the last decade of the 20th century, the GDP in Germany grew by only 18% when, for example, in the Netherlands growth reached 34% and, in the UK, even 35%, thanks to the neoliberal reforms introduced in the 1980s by M. Thatcher. In 2002, unemployment in Germany reached a record level of 13.4 (6.9% in the West and 18.6% in the East). The gen- eral outlook of internal economic factors was clearly negative. Despite the high unemployment rate, the demand for jobs, the willingness to work by German citi- zens was low and German entrepreneurs sought labor abroad. At the same time German investment abroad (FDI) increased sharply. Such a situation was inter- preted in the neo-liberal literature as resulting from an excess of welfare state pro- tection (high social and unemployment benefts) and a disproportionally high standard of living as compared with productivity growth. Germany acquired the reputation of a country with the highest labor costs (Krebs and Scheffel 2013; Kluve and Jacobi 2006). Our analysis of the BDI curve and its four components shows, however, that the situation was much more complex. Certainly, the socio-economic balance analyzed by the BDI was disrupted in 2003, 2009 and 2012 mostly due to deteriorating social expectations, which were relatively low in Germany in other times as well. The state