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3.2.9.1. National Context
Germany, which is Europe’s biggest economy, is experiencing a very low-growth economic development at around 1%. This, combined with the increased costs for pensions and the transfers to rebuild the East-German counties, has caused a general trend for de-constructing the once famous welfare state, including the state funding for universities. Germany’s politicians have embarked on the controversial quest to introduce university student fees, and in general- politicians are quite determined to lower costs and de-bureaucratize the continuously inflating civil servant apparatus.
The German Research Foundation’s (DFG) "Excellence Initiative" most definitely elicited a striking influence on the FU’s self-assessment and the spirit within the university (see below). This national initiative is the first of its kind and can be seen as an act of political entrepreneurship from the ministry of education, which intends to play more decisive role in the allocation of funds [i].
Overall, when seen against the national context, FU is evaluated as being too bureaucratic and inflexible and thus is seen as unfavourable. The FU is a good example of an institution of the German educational system, which is assessed (by FU President Lenzen) to have undergone a process of bureaucratization and overregulation resulting in excessive governmental intervention and legal obligations (Lenzen, 2003).
3.2.9.2. Local & Regional Context
Berlin is - due to the immense costs of renovating the eastern part, coupled with scandalous mismanagement - one of the poorest German cities. On the other hand it has – due to its history – enormous space in the eastern parts of the city (and its surroundings). This keeps rents down (just 75-287 €/month [ii]) and results in the fact that living costs are among the cheapest in Germany. As in London, Berlin hosts the national government and most ministries, which does not have a strong influence on the FU because of its more generalist profile [iii]. Also German media is much less centralized when compared to London, following instead the federalist polycentric setting. Despite its problems, Berlin, having revitalized its position in the realms of power and economics, exhibits a very vibrant and magnetic atmosphere- thus attracting entrepreneurial personalities.
When considering Berlin’s influence on the FU’s condition, its formative influence cannot be overstated, (as has been pointed out in the history as well as in the section on the Humboldt University as a unique  strange attractor (below)).
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[i] Traditionally education has always been a sector, which was very much in the hands of the counties.
[ii] Including extras - DAAD – almost 50% live in individual private flats.
[iii] In fact Berlin’s role as a western outpost did have a much greater influence on the development of the political sciences department at the FU, which became one of the biggest and most important ones in Germany.
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