East German Regions Research Articles

Being a long distance out-commuter or home employee in a rather peripheral region evidence of a German federal state

Many firms in Germany are short of qualified workers, whereby East German regions are particularly affected because of the out-migration to West Germany after the reunification. This gives rise to an important debate for regional policy as the shortage of workers is a major challenge for each region and firm. In this context, out-commuters—workers who commute to work in another region—become an important group of employees to potentially satisfy local labour needs. In this study, we take a closer look at out-commuters in a particular eastern German region—the Federal State Mecklenburg-Vorpommern (MV)—and address the question whether out-commuters are a selective group of individuals working in e.g. occupations or industries that are rarely needed for labour market requirements in MV. Further, we focus on the wage differential between out-commuters and workers who are living and working in MV (home employees). The determination of the factors that explain this wage gap can provide new insights and a deeper understanding of the labour market in MV. This can provide a basis to work out potential strategies to attract the group of out-commuters for a workplace in MV to reduce the complained labour shortage. The derived evidence suggests that only few out-commuters can be recalled, as the labour demand in MV and the respective wage level are too low and the economic structure is too weak to sufficiently gain back out-commuters. Especially females suffer from the job-market weakness in MV.

Household-level Prevalence and Poverty Penalties of Working in Non-teleworkable and Non-essential Occupations:Evidence from East and West Germany in 2019

AbstractHouseholds are prime locations of risk pooling and redistribution. Household constellations in terms of the number of earners and their occupations define households’ capacity to cushion crises such as the COVID-19 pandemic or rising inflation. The occupational structure and the sociodemographic composition of households continue to vary widely between the former East and West German regions. Against the background of rising levels of in-work poverty in recent years, we extend the prevalence and penalties framework as used in poverty research to two occupational risks that gained significance in post-COVID-19 labour markets. Our study addresses two questions: 1) How prevalent were household constellations in which the sole earner or both earners worked in an occupation that was both non-teleworkable and non-essential (NTNE) in East and West Germany in 2019? 2) Did the poverty penalty associated with the sole or both earners working in NTNE occupations differ in East and West Germany in 2019? The most recent available data from the German Microcensus (2019, N=179,755 households) is linked to new data collected on the teleworkability of occupations and occupations’ classification as essential by German federal state decrees in the spring of 2020. Descriptive statistics and regression models show that the prevalence of household constellations where the sole earner or both earners worked in NTNE occupations was relatively similar across East and West Germany. In contrast to overall similar prevalence, in East Germany the poverty penalty associated with the sole or both earners working in NTNE occupations was substantially elevated. Controlling for known occupational disadvantages, including low education, fixed-term contracts, shift work and the lack of leadership responsibilities narrowed but did not eliminate the sizeable gap in poverty penalties associated with NTNE occupations between East and West Germany.

The effects of TV content on entrepreneurship: Evidence from German unification

This paper empirically analyzes whether television (TV) can influence individuals’ decisions to start businesses. To identify TV's effects, we rely on a unique quasi-natural experiment related to the division of Germany after WWII until 1990 into West Germany with a free market economy and the socialist East Germany where starting one's own business was not permitted. Despite this division, Western TV was exogeneously available since the 1960s in some, but not all East German regions and conveyed images and attitudes conducive to entrepreneurship. We use both regional-level and geo-referenced individual-level data and show that since starting a business in East Germany became possible thanks to the reunification in 1990, entrepreneurship incidence is higher in East German regions that had Western TV signal. This indicates a first-order effect on directly exposed individuals. We show that this is due to the effects of Western TV on attitudes and value orientations associated with entrepreneurship, particularly independence. We find no indication that the differences in the entrpreneurship incidence of East German regions with and without Western TV disappear. Instead, we find that successive cohorts and descendants of directly exposed individuals who were not directly exposed themselves more frequently wish to become entrepreneurs. The latter findings are consistent with second-order effects due to intergenerational transmission of an entrepreneurial mindset and suggest that a self-sustaining entrepreneurial culture can be formed. This can cause long-lasting differences between treated and non-treated population groups or regions.

Historical episodes and their legacies across space: A famous case revisited

AbstractThere is a growing amount of literature in economic geography showing that historical episodes can leave long‐lasting cultural and institutional legacies across space. For credibly identifying such persistent effects the analyses should not pick up trends preceding the respective episodes. Against this background, the paper re‐examines the famous case of the German division and reunification. The empirical focus is on the persistent mark‐up of women in work in East relative to West German regions that are often associated with legacy effects of the socialist regime that was in place in East Germany during the country's four decades of division. In contrast to the conventional wisdom in academia, policy, and the public, the current paper shows that the higher share of working women in East German regions is not due to a legacy of socialism. Female labor force participation was already remarkably higher in the East before the introduction of socialism. The general lesson is that any attempt to explain spatial variation in individual decision‐making by persisting institutional and cultural legacies of certain historical episodes needs to assess regional conditions predating these episodes.

What Drives the Location Choice of New Manufacturing Plants in Germany?

About 30 years after German reunification a persistent gap in different firm performance measures exists between East and West Germany. In this paper I focus on the differences in new German manufacturing plants' location choices across the German district-free cities and districts and investigate its regional determinants. For that purpose, I construct a novel, rich regional- and firm-level dataset based on the Official Firm Statistics from the German Federal Statistical Office and the Offices of the Laender. The analysis provides first time evidence how in particular the location decision of firms in the German economy is influenced by regional road infrastructure as well as regional structural funding. The effects are economically important and significant. The results reveal that a 10 percent increase in firm agglomeration increases the odds of a new plant to locate in the region by 12 percent. A 10 percent decrease of travel time on roads increases the odds of a plant to locate by 4 percent in overall Germany, by 7.6 percent among East German regions and by 26.5 percent in particular for large plants in the East German regions. A 10 percent larger population increases the odds to locate by 8.7 percent. A 10 percent increase in regional structural funding for infrastructure purposes increases the odds to locate in a region in East Germany by 8.3 percent in particular for large plants. Policy implications emerge that address in particular the improvement of infrastructure and support to reap off benefits that arise from agglomeration externalities.

What Drives the Location Choice of New Manufacturing Plants in Germany?

About 30 years after German reunification a persistent gap in different firm performance measures exists between East and West Germany. In this paper I focus on the differences in new German manufacturing plants' location choices across the German district-free cities and districts and investigate its regional determinants. For that purpose, I construct a novel, rich regional- and firm-level dataset based on the Official Firm Statistics from the German Federal Statistical Office and the Offices of the Laender. The analysis provides first time evidence how in particular the location decision of firms in the German economy is influenced by regional road infrastructure as well as regional structural funding. The effects are economically important and significant. The results reveal that a 10 percent increase in firm agglomeration increases the odds of a new plant to locate in the region by 12 percent. A 10 percent decrease of travel time on roads increases the odds of a plant to locate by 4 percent in overall Germany, by 7.6 percent among East German regions and by 26.5 percent in particular for large plants in the East German regions. A 10 percent larger population increases the odds to locate by 8.7 percent. A 10 percent increase in regional structural funding for infrastructure purposes increases the odds to locate in a region in East Germany by 8.3 percent in particular for large plants. Policy implications emerge that address in particular the improvement of infrastructure and support to reap off benefits that arise from agglomeration externalities.

Public Investment Subsidies and Firm Performance – Evidence from Germany

AbstractThis paper assesses firm-level effects of the single largest investment subsidy programme in Germany. The analysis considers grants allocated to firms in East German regions over the period 2007 to 2013 under the regional policy scheme Joint Task ‘Improving Regional Economic Structures’ (GRW). We apply a coarsened exact matching (CEM) in combination with a fixed effects difference-in-differences (FEDiD) estimator to identify the effects of programme participation on the treated firms. For the assessment, we use administrative data from the Federal Statistical Office and the Offices of the Länder to demonstrate that this administrative database offers a huge potential for evidence-based policy advice. The results suggest that investment subsidies have a positive impact on different dimensions of firm development, but do not affect overall firm competitiveness. We find positive short- and medium-run effects on firm employment. The effects on firm turnover remain significant and positive only in the medium-run. Gross fixed capital formation responses positively to GRW funding only during the mean implementation period of the projects but becomes insignificant afterwards. Finally, the effect of GRW-funding on labour productivity remains insignificant throughout the whole period of analysis.

Innovation cooperation in East and West Germany: a study on the regional and technological impact

In this paper, we investigate the impact of regional and technological innovation systems on innovation cooperation. We develop an indicator applicable to regions, which demonstrates the relative regional impact on innovation cooperation. Applying this method to German patent data, we find that regional differences in the degree of innovation cooperation do not only depend on the technology structure of a region but also on specific regional effects. High-tech oriented regions, whether east or west, are not automatically highly cooperative regions. East German regions have experienced a dynamic development of innovation cooperation since re-unification in 1990. Their cooperation intensity remains higher than in West German regions.

A divergent convergence: welfare and gender in West and East German regions after the unification

A divergent convergence: welfare and gender in West and East German regions after the unification

Internal Migration in Germany, 1995-2010: New Insights into East-West Migration and Re-urbanisation

Over the last two decades, patterns of internal migration in Germany have been discussed under the headings of East-West movements and sub- and re-urbanisation. This paper argues that the intense scientific and public debate that ignited about the possible causes and consequences of internal migration should be based on a clear understanding of how internal migration flows impact on regional population change. Using the German Internal Migration (GIM) database, a unique new dataset that holds annual interregional migration counts drawn from the population register for 397 regions with temporally consistent boundaries, this paper aims to provide a more comprehensive picture of the spatial structure of inter-county migration in Germany and how it has changed over the period 1995-2010. To reduce the complexity of the county-level flow data and to facilitate the identification of patterns and trends, county-to-county flows were analysed using a spatial framework of 132 “analytical regions”. The results show that the intensity of migration between East German regions has been higher than East-West migration throughout the period, suggesting that the former type of migration has a stronger impact on rural population decline than commonly believed in the literature. Following a strong suburbanisation pattern in the 1990s, over the last decade, migration between counties in eastern Germany has resulted in a growing concentration of population in the cities of Berlin, Leipzig and Dresden. Increasing net migration gains were recorded by many urban cores across Germany. The trend was driven by both continuing in-migration of young adults in search for education and employment, and by a cessation of the long-term trend of family out-migration to the cities’ suburban and non-metropolitan hinterlands.

Common Agricultural Policy effects on dynamic labour use in agriculture

The aim of this study is to investigate the effects of direct payments and rural development measures of the EU’s Common Agricultural Policy (CAP) on employment in agriculture. We work with a dynamic labour demand equation augmented by the full set of policy instruments of the CAP, which is estimated on a panel dataset of 69 East German regions. We present results for four estimators which differ in how they eliminate the fixed effects and how they address the endogeneity of the lagged dependent variable. The results suggest that there were few desirable effects on job maintenance in agriculture. While there is some indication that investment subsidies have halted labour shedding on farms, a rise in the general wage level reduced labour use in agriculture. Changes in direct payments had no employment effects. Generally, labour adjustment exhibits a strong path dependency.

The Competitiveness of Regions: A Comparison between Belgian and German Regions

We analyze the regional competitiveness of NUTS1 German and Belgian regions using firm level data. By doing so, we want to stress the importance of heterogeneity between regions within countries, as well as of firm heterogeneity, in the context of competitiveness analysis. We thus take a step away from the standard approach to the topic which makes use of composite indicators, and define competitiveness as labor cost per unit of value added at the firm level. But in doing so, we control for firm size and the sector the firm operates in. We further break down the analysis into productivity and labor cost dynamics. Using Flanders’ performance as benchmark, we find that the region ranks high in terms of labor productivity, but loses its competitive edge to East German regions especially because of its relatively high labor costs. Belgian regions are in general outperformed by German ones, at least as far as manufacturing production is concerned.

Peculiarities of transformation processes in East Germany

The mention is made of the process of socio-economic transformation of East German regions after reunification of Germany in 1990. The definition of the term «transformation» is given. Historical determinants and socio-economic components of transformation process in Germany are researched. Results of transformation of East Germany are analyzed.

Statistical calculation of the transition of vitamin a and β-carotene ingestion in the former West and East German regions between 1986 and 1993

Retinol (ROL) and β-carotene (BC) are vitamin A (VA) derivatives and are taken up by humans for use as nutrients. The intake of these derivatives can be calculated by extrapolation from food consumption data. In this study, food consumption statistics of the former West and East German regions between 1986 and 1993 were calculated, concentrating on East Germany’s transition towards reunification with West Germany. Retinol equivalent (RE), ROL and BC intakes in 1986 were much lower in East Germany than in West Germany. A strong increase in the uptake levels of RE, ROL and especially BC from 1986 to 1993 was observed in East German women, men and children, and was partly dependent on household financial status. This remarkable elevation was most likely caused by alterations in consumed food varieties in East Germany following reunification. Since high dietary intake of VA was shown to be associated with atopy, the observed elevated RE, ROL and especially BC uptake of East Germans might also have affected their prevalence of atopic disease.

Gatekeepers in regional networks of innovators

The internal density of a local network is said to increase the regionspecific knowledge-stock and might lead to a comparative advantage. However, it might also lead to a lock-in situation, if local trajectories are directed towards inferior solutions. Accordingly it is argued that successful clusters are characterised by the existence of gatekeepers, i.e. actors that generate novelty by drawing on local and external knowledge. We attempt to answer questions related to the role and characteristics of gatekeepers within regional innovation systems by applying social network analysis based on patent data for four East-German regions. The regional networks appear to be significantly dierent with respect to the overall degree of interaction and with respect to their relative outward orientation. Concerning the characteristics of gatekeepers, we find that size does not play the major role for being a gatekeeper. It is rather absorptive capacity that matters for gatekeepers. It also shows that public research organisations serve the functions of a gatekeeper to a higher degree than private actors.

Public Research in Regional Networks of Innovators: A Comparative Study of Four East German Regions

Graf H. and Henning T. Public research in regional networks of innovators: a comparative study of four East German regions, Regional Studies. Universities and public research organizations are said to be integrative and essential elements of a functioning innovation system. Four East German regional networks of innovators are analysed and the characteristic role of public research within these networks is investigated by applying methods of social network analysis using patent data. The results show that universities and non-university institutions of public research are key actors in all regional networks. Differences between regional innovative performance seem to be related to differences in the structural properties of the networks. Graf H. et Henning T. La recherche publique sur les réseaux régionaux d'innovateurs: une étude comparative de quatre régions situées en Allemagne de l'Est, Regional Studies. On dit que les universités et les établissements de recherche publics constituent des parties intégrantes et essentielles d'un système d'innovation opérationnel. Ici, on analyse quatre réseaux régionaux d'innovateurs en Allemagne de l'Est et à examiner le rôle type de la recherche publique au sein de ces réseaux en employant des méthodes qui cherche à analyser les réseaux sociaux à partir des données sur les brevets. Les résultats laissent voir que les universités et les établissements de recherche publique en dehors des universités sont des éléments clé de tout réseau régional. Il semble que les différences de la performance régionale d'innovation se rapportent aux différences des propriétés structurelles des réseaux. Réseaux d'innovateurs Recherche publique Coopération en R et D Mobilité des scientifiques Graf H. und Henning T. Öffentliche Forschung in regionalen Netzwerken von Innovatoren: eine vergleichende Studie von vier ostdeutschen Regionen, Regional Studies. Universitäten und öffentliche Forschungseinrichtungen gelten als integrative und wesentliche Bestandteile eines funktionierenden Innovationssystems. Wir analysieren vier ostdeutsche regionale Netzwerke von Innovatoren und untersuchen die charakteristische Rolle der öffentlichen Forschung innerhalb dieser Netzwerke, indem wir unter Verwendung von Patentdaten Methoden der Sozialnetzwerkanalyse anwenden. Unsere Ergebnisse zeigen, dass Universitäten und nichtuniversitäre Einrichtungen der öffentlichen Forschung in sämtlichen regionalen Netzwerken zentrale Akteure darstellen. Die Unterschiede zwischen der regionalen innovativen Leistung scheinen mit Unterschieden hinsichtlich der strukturellen Eigenschaften der Netzwerke zusammenzuhängen. Netzwerke von Innovatoren Öffentliche Forschung Zusammenarbeit bei F&E Mobilität von Wissenschaftlern Graf H. y Henning T. Investigación pública en las redes regionales de innovadores: un estudio comparativo de cuatro regiones de Alemania del Este, Regional Studies. Las universidades y las organizaciones de investigación públicas se consideran elementos integradores e indispensables de un sistema de innovación en funcionamiento. Analizamos cuatro redes regionales de innovadores de Alemania del Este e investigamos el rol característico de la investigación pública en estas redes con ayuda de métodos analíticos de redes sociales usando datos de patentes. Nuestros resultados indican que las instituciones universitarias y no universitarias de investigación pública son los participantes clave de todas las redes regionales. Las diferencias entre el desempeño innovador regional parecen estar relacionadas con las diferencias en las propiedades estructurales de las redes. Redes de innovadores Investigación pública Cooperación de I + D Movilidad científica

Wie Städte dem Umland Paroli bieten können

The growing attractiveness of residential locations in urban areas compared with peripheral areas is strongly discussed. Nevertheless, migrations from cities to surrounding areas continue both in growing and shrinking cities. Interviews executed among migrants in two West and two East German regions moving from cities to the surrounding area have provided comparative regional results on household structures, mobility patterns, the process of deciding to migrate but also on later reflections upon this decision. The results also include the analysis of the financial calculation of private households. The article furthermore deals with the future framework conditions for the choice of the residence and shows strategies how to limit urban-rural migrations which might strengthen central cities as residential locations and at the same time help to reduce the traffic in metropolitan regions.

Gatekeepers in Regional Networks of Innovators

The internal density of a local network is said to increase the region-specific knowledge-stock and might lead to a comparative advantage. However, it might also lead to a lock-in situation, if local trajectories are directed towards inferior solutions. Accordingly it is argued that successful clusters are characterised by the existence of gatekeepers, i.e. actors that generate novelty by drawing on local and external knowledge. We attempt to answer questions related to the role and characteristics of gatekeepers within regional innovation systems by applying social network analysis based on patent data for four East-German regions. The regional networks appear to be significantly different with respect to the overall degree of interaction and with respect to their relative outward orientation. Concerning the characteristics of gatekeepers, we find that size does not play the major role for being a gatekeeper. It is rather absorptive capacity that matters for gatekeepers. It also shows that public research organisations serve the functions of a gatekeeper to a higher degree than private actors.

Konvergenz- und Wachstumseffekte der europ�ischen Regionalpolitik in Deutschland

: This article analyses the impact of EU structural policy on the economic development of German regions between 1995 and 2004. In this period East-German regions have converged, while regional disparities have been increasing in West-Germany. In addition East-German Landkreise have caught up with poor western regions. However the overall gap between rich and poor Landkreise has risen. Economic theory describes a trade-off between regional convergence and aggregate growth. Our empirical findings support this hypothesis. It is shown that the EU's regional transfers speed up convergence, but have a negative impact on long-run aggregate growth.

Pendelbereitschaft von Arbeitnehmern in Deutschland

An analysis of the commuter behaviour is an important question because of the high unemployment rate in many German regions. However, there are no actual investigations for the whole country. We use data of the Federal Employment Office (Bundesagentur für Arbeit), which include all national insurance contributors, to estimate gravity models. These calculations show the willingness to travel from home to work for all employed persons as well as for sociodemographic subgroups. It can be stated that men are more prepared to commute than women if the distance is increasing, that Germans are more willing to commute than foreigners and that workers have a greater commuting resistance than other employees. A local analysis shows that the influence of distance on commuting is higher in East German regions than in West Germany. One reason for that result may be the lower wages in East Germany. Employees accept longer driving times to work in economically prosperous regions in West Germany.