Cross-border Mergers in European Banking and Bank Efficiency: Discussion
Reint E. Gropp
Foreign Direct Investment in the Real and Financial Sector of Industrial Countries,
2003
Abstract
Read article
Investment assistance in Eastern Germany: Risk reforms! - A commentary
Joachim Ragnitz
Wirtschaft im Wandel,
No. 16,
2002
Abstract
Read article
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.
Read article
Hardly any technology spillovers from supplier contacts of foreign subsidiaries in Hungary
Jutta Günther
Wirtschaft im Wandel,
No. 13,
2002
Abstract
“Almost no technology spillovers via supplier contacts of foreign subsidiaries in Hungary“ Transition economies in the process of catching-up expect that interactions between modern equipped foreign subsidiaries and backward local companies lead to technology spillovers, especially via supplier contacts. The explorative empirical study shows, however, that linkages between foreign subsidiaries and local firms do hardly exist. First, this is due to the fact that the foreign affiliates largely stick to suppliers in their home countries. Second, the technological disparities between foreign subsidiaries and local firms - the so-called dual structure of economy - hinders cooperation in the field of supplier contacts.
Read article
Effects of accelerated extension of the East German traffic infrastructure - The example of the A 72 Chemnitz-Leipzig
Walter Komar, Joachim Ragnitz
Wirtschaft im Wandel,
No. 12,
2002
Abstract
Growth and the productivity can be positively affected by the accelerated development of the infrastructure by regions. That was empirically proven by a study of the IWH. The example of the planned motorway BAB 72 Chemnitz-Leipzig shows that a prema-ture realization of the entire route will have important impulses for investments, em-ployment and turnover of firms.
Read article
Recent Developments and Risks in the Euro Area Banking Sector
Reint E. Gropp, Jukka M. Vesala
ECB Monthly Bulletin,
2002
Abstract
This article provides an overview of euro area banks’ exposure to risk and examines the effects of the cyclical downturn in 2001. It describes the extent to which euro area banks’ risk profile has changed as a result of recent structural developments, such as an increase in investment banking, mergers, securitisation and more sophisticated risk management techniques. The article stresses that the environment in which banks operated in 2001 was fairly complex due to the relatively weak economic performance of all major economies as well as the events of 11 September in the United States. It evaluates the effects of these adverse circumstances on banks’ stability and overall performance. The article provides bank balance sheet information as well as financial market prices, arguing that the latter may be useful when assessing the soundness of the banking sector in a forward-looking manner. It concludes with a review of the overall stability of euro area banks, pointing to robustness in the face of the adverse developments in 2001 and the somewhat improved forward-looking indicators of banks’ financial strength in early 2002.
Read article
Economic Development 2002 and 2003: Investments – The Achilles Heel of the Economy
Wirtschaft im Wandel,
No. 10,
2002
Abstract
The Article analyses and forecasts the economic developments for the World and German in 2002 and 2003. During the winter 2001/2002 the World Economy was able to pull out of its trough. Nonetheless, the upswing did not reach investments and was mainly driven by consumption and exports in the USA and the remaining major economies, respectively. In the course of this and next year Investors will gradually regain their trust in the economy. The same will be the case for consumers in Germany and Europe. As a result a modest recovery on a wide front will develop. In the course of next year this recovery will start to weaken. In Germany, Wage Policy has retracted from its former moderate stance. Hence, although due to the improving economic conditions and the resulting slowed employment cuts by the end of 2002 as well as employment increases in 2003, the upswing on the labour market will not reach the dynamics of the 1999/2000 recovery. Fiscal Policy, caused by the need to consolidate the public budget, will be restrictive. Despite the low inflation risks, by the end of this year the ECB will have raised its major interest rate by 1/2 percentage point. Nonetheless, as interest rates in real terms will remain at relatively low levels a restrictive impact from the Monetary Policy in Germany and the Euro Area will is not expected. The most important Data for the World Economy and Germany are being stated in detailed tables.
Read article
Consequences of EU enlargement for regional promotion measures in East Germany
Franz Kronthaler, Martin T. W. Rosenfeld
Wirtschaft im Wandel,
No. 9,
2002
Abstract
Consequences of EU enlargement for regional policy in East Germany EU enlargement will change the status of regions currently assisted by EU regional policy. A number of regions will probably lose their status as “Objective 1 Region” and will hence have to exist without EU regional policy funding. Furthermore it has to be assumed that the EU will additionally reduce the maximal permitted regional aid rate for investment in the same regions. Most regions in the East German Länder will be affected by these changes. A “phasing out” of such Objective 1 Regions could ease the adjustment pressures. In anticipating to the probable reduction of the regional aid rate for investment, the development of infrastructure should already today be intensified in order to alleviate locational disadvantages as far as possible.
Read article
FDI as Multiplier of Modern Technology in Hungarian Industry
Jutta Günther
Intereconomics,
No. 5,
2002
Abstract
Foreign direct investment is generally expected to play a significant role as a multiplier of modern production and management know-how in Central Eastern European transition economies. The following paper examines the various mechanisms by which such technological spillover effects could in theory take place and compares them with the results of an empirical study of their practical significance for Hungarian industry.
Read article
Regional effects of infrastrukture investments on the New Länder
Walter Komar, Evelyn Krolopp, Joachim Ragnitz
IWH-Sonderhefte,
No. 2,
2002
Abstract
Given infrastructure deficiencies in eastern German states and concomitant
weak growth, the present volume analyzes the extent to which making
important infrastructure projects a priority could more quickly improve
local business conditions in eastern Germany. Although the Solidarity Pact
II makes funds available for infrastructure development, these funds are
allocated over a period of twenty years. This timeframe will not allow the
rapid improvement of local business conditions.
Read article