Stoiber has voiced anti-immigration views - but some observers doubt his willingness radically to reform Germany's protective labour laws and other economic rigidities.
What separates the big spenders from the improvers, McKinsey found, is the awareness that different types of school system respond to radically different types of reform.
"What we are looking at is the government making investment in social care, backing radical reform - not just tinkering at the edges... radically reforming care to give people the opportunity to save for their retirement and prepare for their retirement, " she added.