Great Moderation at the Firm Level? Unconditional vs. Conditional Output Volatility
Claudia M. Buch, Jörg Döpke, K. Stahn
B.E. Journal of Economic Analysis and Policy,
No. 1,
2009
Abstract
We test whether there has been a “Great Moderation“ of output volatility at the firm level. The multifactor residual model proposed by Pesaran (2006) is used to isolate the idiosyncratic component of firms' sales growth from macroeconomic developments. This methodology is applied to a balanced panel of about 1,200 German firms covering a 35-year period (1971-2005). Our research has three main findings. First, unconditional firm-level volatility and aggregate output volatility have seen similar downward trends. Second, conditional, idiosyncratic firm-level volatility does not exhibit a downward trend. Third, there is a positive link between growth and volatility at the firm level.
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Consequences, opportunities and challenges for modern biotechnology for Europe (BIO4EU) - TASK 2. Report 3
S. Gaisser, Iciar Dominguez Lacasa, Thomas Reiss
One-off Publications,
No. 4,
2008
Abstract
Modern biotechnology is one of the key enabling technologies of the 21st century with a potentially wide range of applications in many sectors, including health, agriculture and industrial processes. Considering the potential of modern biotechnology to contribute to the achievement of major European Union policy goals, such as economic growth and job creation, public health, environmental protection and sustainable development, the European Parliament has requested the European Commission to carry out an assessment of modern biotechnology. The European Commission welcomed the initiative and announced to undertake a study “to conduct a cost benefit analysis of biotechnology and genetic engineering, including genetically modified organisms in the light of major European policy goals formulated in the Lisbon Strategy,
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Political Institutionalisation and Economic Specialisation in Polycentric Metropolitan Regions – The Case of the East-German ‘Saxony Triangle’
Peter Franz, Christoph Hornych
IWH Discussion Papers,
No. 6,
2009
Abstract
The rising attention of politicians as well as scientists in the EU to the large urban agglomerations as centres of economic growth is accompanied by political efforts to identify and to demarcate such agglomerations under the label ‘metropolitan regions’. This study develops a theoretical framework broaching the issue of cooperation between municipalities from the perspective of regional economics as well as political science. The framework is applied to the empirical case of the polycentric metropolitan region ‘Saxony Triangle’ in East Germany. The results show that various intervening factors prevent intense cooperation between the actors in the region. Policy implications and con-
clusions for future research are discussed.
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The Formation of Photovoltaic Clusters in Eastern Germany
Matthias Brachert, Christoph Hornych
Wirtschaft im Wandel,
No. 2,
2009
Abstract
One of the weaknesses of the East German economy is the relative lack of management functions and headquarters along with the relatively low research and developing efforts of the companies. With the emergence of new industries, there is a chance to respond to these weaknesses. Against this background, the article examines the emergence and development of the photovoltaic industry in Eastern Germany. The strong production and sales growth of the industry in the recent years is a result of central government funding programs. But up to now, East German regions have profited disproportionately from the growth of the sector. In 2008, we find about 14 000 direct industry employees in this sector in Eastern Germany.
Based on the Window of Locational Opportunity concept (WLO) by Storper and Walker – a stage model of industrial development –, this article describes the reasons of the development of the industry in Eastern Germany from 1996 until 2008. In spite of persistent growth processes and the foundation of new companies within the photovoltaic industry, a concentration on some certain locations, linked with the process of the formation of industrial clusters, becomes apparent. In a first result of the emergence of clusters, the regions of Bitterfeld-Wolfen, Dresden/Freiberg, Erfurt/Arnstadt, Frankfurt (Oder) and Berlin build leading sites in Eastern Germany.
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Development of Economy and Public Budgets in the Medium Term
Kristina vanDeuverden, Rolf Scheufele
Wirtschaft im Wandel,
No. 1,
2009
Abstract
The paper presents a forecast of the medium term development in Germany. In the years 2010 until 2013, economic growth will come on average to 1½%, basically borne by foreign trade as well as domestic demand. Public budgets will worsen in the years 2009 until 2010 mainly due to the present downturn and the political measures taken in this context. During the years afterwards, public finances will start to recover slightly.
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The Africa dummy revisited - The African growth gap, development policy and the realization of the MDGs
Eva Dettmann
African Development Perspectives Yearbook, No. 13,
2008
Abstract
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Growth, Volatility, and Credit Market Imperfections: Evidence from German Firms
Claudia M. Buch, Jörg Döpke
Journal of Economic Studies,
2008
Abstract
Purpose – The purpose of this paper is two-fold. First, it studies whether output volatility and growth are linked at the firm-level, using data for German firms. Second, it explores whether the link between volatility and growth depends on the degree of credit market imperfections.
Design/methodology/approach – The authors use a novel firm-level dataset provided by the Deutsche Bundesbank, the so-called Financial Statements Data Pool. The dataset has time series observations for German firms for the period 1997-2004, and the authors use information on the debt-to-assets or leverage ratio of firms to proxy for credit-constraints at the firm-level. As additional proxies for the importance of credit market imperfections, we use information on the size and on the legal status of firms.
Findings – The authors find that higher volatility has a negative impact on growth for small and a positive impact for larger firms. Higher leverage is associated with higher growth. At the same time, there is heterogeneity in the determinants of growth across firms from different sectors and across firms with a different legal status.
Practical implications – While most traditional macroeconomic models assume that growth and volatility are uncorrelated, a number of microeconomic models suggest that the two may be linked. However, it is unclear whether the link is positive or negative. The paper presents additional evidence regarding this question. Moreover, understanding whether credit market conditions affect the link between volatility and growth is of importance for policy makers since it suggests a channel through which the credit market can have long-run welfare implications. The results stress the importance of firm-level heterogeneity for the effects and effectiveness of economic policy measures.
Originality/value – The paper has two main novel features. First, it uses a novel firm-level dataset to analyze the determinants of firm-level growth. Second, it analyzes the growth-volatility nexus using firm-level data. To the best of the authors' knowledge, this is the first paper, which addresses the link between volatility, growth, and credit market imperfections using firm-level data.
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The African growth gap, Development Policy and the Realization of the MDGs
Tobias Knedlik, Eva Reinowski
African Development Perspectives Yearbook, No. 13,
2008
Abstract
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New Growth and Poverty Alleviation Strategies for Africa - International and Regional Perspectives. African Development Perspectives Yearbook, Vol. 13
Karl Wohlmuth, Tobias Knedlik, Mareike Meyn, Afeikhena Jerome, T. (eds) Urban
,
2008
Abstract
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