ABSTRACT
The extent to which labor was able to influence unemployment policies varied with prevailing ethical considerations, perceptions of economic alternatives, and configurations of political influence. Although aggregate unemployment statistics are sorely lacking for the early years of our period, scattered clues suggest something other than a monolithic response of the German labor market to economic crises. Evidence gleaned from quarterly reports presents a complex and occasionally confusing picture of German entrepreneurs' responses to economic crises. One of the primary reasons why employment continued to expand during recessions was that individual entrepreneurs developed alternatives to dismissing their labor force in times of crisis. One of the most commonly adopted practices to avoid laying off employees was to reduce wages, hours or both. Reduced wages as an alternative to unemployment implemented by individual entrepreneurs at the micro-economic level made that broadly-based division possible in Germany.
