Significant Progress in East German Machine Construction Industry
Siegfried Beer
Wirtschaft im Wandel,
No. 2,
2003
Abstract
The restructuring of the mechanical engineering industry of the new Länder has displayed clearly positive effects. Between 1997 and 2001, productivity and turnover have increased by about 25 %. Since mid 1999 the number of employees has also gone up again. Business surveys indicate an improvement in profitability. This positive development is due to an increase in competitiveness which is based on new product lines together with more effective innovation activities. Growth has also been enhanced by the enlargement and modernisation of the capital stock and a moderate movement of wages. Despite this progress the east German engineering industry as a whole does by far not reach the productivity figures of its west German counterpart. Differences explaining this gap are found in the product structure with dominating customer specific products and in the firm size with a smaller number of employees in the East.
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Innovation cooperation in East Germany - only a half-way success?
Jutta Günther
IWH Discussion Papers,
No. 170,
2003
Abstract
The paper focuses on the question whether enterprises that engage in innovation cooperation with external partners are more innovative and thus more productive than non-cooperating firms. A comparison between East and West Germany is being made. It shows that cooperating enterprises in East and West Germany are indeed more innovative than non-cooperating firms, but there remains a clear productivity gap between East and West German cooperating firms. Furthermore, in East Germany - different from West Germany - non-cooperating firms are even more productive than cooperating firms.
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Intra-industry trade and the productivity gap in the enlarged EU
Hubert Gabrisch
Wirtschaft im Wandel,
No. 16,
2002
Abstract
Trade between the European Union (EU) and the Transition Economies (TE) is increasingly characterised by intra-industry trade. The decomposition of intra-industry trade into horizontal and vertical shares reveals predominantly vertical structures with decisively more quality advantages for the EU and less quality advantages for TE countries whenever trade has been liberalised. Sizeable foreign direct investment did obviously not reduce the superiority of producers in the EU in terms of technology, capital and human capital. The productivity gap between the EU and TE countries remains. EU firms have been able to increase their product quality and to shift low-quality segments of production to TE countries. This may suggest a product-quality cycle prevalent in EU-TE trade. The testing of this model confirms the assumptions.
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Comparable types of regions in East and West Germany show disparities – East German urban agglomerations have difficulties!
Gerhard Heimpold, Martin T. W. Rosenfeld
Wirtschaft im Wandel,
No. 15,
2002
Abstract
A discussion about the reform of regional policy in Germany and in the EU is ongoing. Against this background the article investigates the regional disparities between similar types of regions in East and West Germany after reunification. The findings do not only show a general East-West gap of economic welfare and of their determinants but also a visible spatial differentiation. It shows that the East German agglomerations have disadvantages in the field of interregional competition. They are worse endowed with crucial growth determinants compared with their West German counterparts, whereas the East-West differences for urbanized regions (where the population density is medium-sized) and rural regions are smaller. The disadvantages stated suggest a stronger concentration of regional policy in favour of these agglomerated spaces targeted on improving the locational attractiveness and strengthening their function as driving forces of the economic catch-up process in East Germany.
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Intra-industry trade between European Union and Transition Economies. Does income distribution matter?
Hubert Gabrisch, Maria Luigia Segnana
IWH Discussion Papers,
No. 155,
2002
Abstract
EU-TE trade is increasingly characterised by intra-industry trade. For some countries (Czech Republic), the share of intra-industry trade in total trade with the EU approaches 60 percent. The decomposition of intra-industry trade into horizontal and vertical shares reveals overwhelming vertical structures with strong quality advantages for the EU and shrinking quality advantages for TE countries wherever trade has been liberalised. Empirical research on factors determining this structure in an EU-TE framework has lagged theoretical and empirical research on horizontal trade and vertical trade in other regions of the world. The main objective of this paper is, therefore, to contribute to the ongoing debate over EU-TE trade structures, by offering an explanation of intra-industry trade. We utilize a cross-country approach in which relative wage differences and country size play a leading role. In addition, as implied by a model of the productquality
cycle, we examine income distribution factors as determinates of the emerging
EU-TE structure of trade flows. Using OLS regressions, we find first, that relative
differences in wages (per capita income) and country size explain intra-industry trade, when trade is vertical and completely liberalized and second, that cross country differences in income distribution play no explanatory role. We conclude that if increasing wage differences resulted from an increasing productivity gap between highquality and low-quality industries, then vertical structures will, over the long-term create significant barriers for the increase in TE incomes and lowering EU-TE income differentials.
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Public Research Institutions in East Germany: a Promising Base for Economic Upturn?
Gerhard Heimpold, Martin T. W. Rosenfeld
Wirtschaft im Wandel,
No. 15,
2001
Abstract
In the 1990s a lot was done to strengthen public research efforts in East Germany. The main indicators relating to public research reflect an ambivalent picture. Investment by universities and public research institutions outside the universities reached a higher level than in West Germany. However, there remains an East-West gap with respect to the capital stock. The per capita stock of R&D staff in the university sector reached almost the level in the old Länder. With respect to the university R&D in engineering sciences, among those fields of university research which are particularly business-related, per capita stock of staff as well as per capita investment in the Eastern German Länder are above the West German level. In university natural science the East-West pattern of the R&D input factors mentioned is reversed. The receipts of the universities acquired from research contracts, which may be used as an indicator to assess the quality of public research, reveal shortcomings. These shortcomings, though these have been partly caused by the transitional situation in East Germany`s universities, where new institutions were built up only gradually. The R&D institutions outside the universities are obviously better equipped than such institutions in West Germany.
The visible advantages offered by public sector research institutions in East Germany might be used much more intensively to foster the economic reconstruction in East Germany. In parallel with this, the remaining shortcomings of public R&D in East Germany should be eliminated. If reductions in universities´ capacities (due, for instance, to a declining number of persons who have a university entrance qualification) seem to be inevitable, the consequences of such restrictions should be carefully reconsidered.
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On the Future EU Cohesion Policies in Association States: the
Johannes Stephan
Wirtschaft im Wandel,
No. 15,
2001
Abstract
Not only are levels of economic development in the association states in Central
East Europe lower than the average EU-15. They furthermore exhibit significantly
different sectoral structures. Does this suggest that a large fraction of the develop-
ment gap can be explained by those sectoral differences? In its latest report on
cohesion policy, the EU Commission accordingly placed particular emphasis on
sectoral structures when contemplating future intervention policy in newly acceeding
members.
Our analysis shows, however, that the patterns of sectoral structures play only a
minor role as determinants of the lower level of development, measured here as
productivity gap. The explanatory power of sectoral differennces is significant only
in Slovakia. The suggestions made in the EU-report is not supported by our
analysis. The existing programmes appear to be well equipped to account for the
particuliarities in transition economies.
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Network activities and the productivity gap in East Germany: The role of agglomeration advantages
Anita Wölfl, Joachim Ragnitz
Wirtschaft im Wandel,
No. 13,
2001
Abstract
The article presents first some theoretical considerations about the connection between productivity and networking activities of enterprises. By operationalizing networks as an agglomeration of firms in a specific region, it is argued with respect to the East German economy that such networks have not yet developped in a sufficiently matter. Additionally, a “critical“ degree of agglomeration, from which networking activities lead to higher productivity, is missing in nearly all East German regions.
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Methods of estimating the overall economic production potential and the productivity gap
Klaus Weyerstraß
IWH Discussion Papers,
No. 142,
2001
Abstract
Für die wirtschaftspolitischen Instanzen stellt die Kenntnis des Produktionspotentials und des daraus abgeleiteten gesamtwirtschaftlichen Kapazitätsauslastungsgrades eine wichtige Orientierungsgröße dar. In diesem Diskussionspapier werden verschiedene Methoden der Schätzung des Produktionspotentials dargestellt. Diese umfassen Unternehmensbefragungen, reine Zeitreihenmethoden und Verfahren, die explizit die ökonomische Theorie berücksichtigen. Hier ist insbesondere der Produktionsfunktions-Ansatz zu nennen. Abschließend werden einige der vorgestellten Schätzmethoden auf Daten der Bundesrepublik Deutschland angewandt.
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