Joachim Nagel: Is it time for a prosperity update? - Productivity, competition and stable money in the digital age

Ludwig Erhard Lecture by Dr Joachim Nagel, President of the Deutsche Bundesbank, organised by the Initiative New Social Market Economy (INSM), Berlin, 31 October 2023.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Central bank speech  | 
13 November 2023


Ladies and gentlemen,

I am delighted to be with you today here in Berlin to give this Ludwig Erhard Lecture.

I hope you all found your way here without any problems. You may have wondered before leaving home whether it would rain today. Perhaps you needed a ticket to travel here by public transport. Maybe you cycled or walked, and didn't know the way here. If so, I would be surprised if you hadn't used your smartphone in some way.

When Ludwig Erhard published his book "Prosperity for All", things weren't that simple: to buy a train ticket, you generally had to go to the station and queue up at the counter. To find your way around town, you needed a map of the city, which you would unfold in order to look for a route. You started by asking: where am I and where do I need to go? And if you wanted to know what weather to expect, you checked the newspaper or listened out for the weather report on the radio.

Nowadays, all it takes is a finger swipe or a voice command to obtain such information. That's thanks to digitalisation. It's made our daily lives easier in many ways. Or when was the last time you pored over a street map, studied a timetable or flipped through a phonebook? And it has opened up new ways for us to communicate, to network and to share in the world's knowledge.

Technological progress is also bringing the economy further into the digital age. Networked machines and cloud-based services have long since become part of day-to-day business operations. Many firms are currently testing the potential uses of artificial intelligence. And in the medium term, quantum computing could cross the threshold to broad applicability.