Spatially Concentrated Industries as Innovation Driver? – Empirical Evidence from East Germany
Christoph Hornych, Michael Schwartz
Wirtschaft im Wandel,
No. 9,
2008
Abstract
A positive relation between the spatial concentration of sectors and their capacity of innovation is frequently assumed in regional science as well as in regional development policy. Therefore, with the support of sectoral agglomeration, effects on the regional technological performance are expected. However, previous empirical work is inconsistent in supporting this interdependency.
This study aims to examine the effects of sectoral agglomeration on innovative activities in East-German regions. For this purpose, spatially concentrated industries are identified and included in the estimation of regional ‘knowledge-production-functions’. Contrary to expectations, the spatial concentration seems to inhibit the amount of patent-activities of the sector in the specific region. In contrast, positive effects are generated from research facilities. Moreover, we find evidence for intersectoral spillovers.
The results show that for innovative activities, urbanization effects have a higher relevance as localization effects. So far, spatially concentrated industries are not an innovation driver in East Germany.
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Der lange Schatten des Sozialismus: Folgen für die Wirtschaftspolitik in Ostdeutschland
Ulrich Blum
List Forum für Wirtschafts- und Finanzpolitik,
2008
Abstract
East Germany’s economy growth was not able to close, over the last ten years, the lag against the West German economy. This paper inquires into the economic reasons, especially those that can be traced in history. It is shown that the exodus of elites from what was Central Germany started in the 1930s because of the persecution of the Jewish elites. During the period after the Second World War until the construction of the wall in 1961 especially young and qualified people left the Soviet Zone and later the G.D.R. Thus, the elites destroyed in the Third Reich and the Second World War could not be replaced exogenously. In the 1970s, an inadequate economic system destroyed the still existing industrial middle class which was an important base of productivity and helped to generate foreign income because of its export intensity to the Western countries. This generated a current account crisis which was only overcome by a loan from West Germany, the so-called “Strauß-Kredit”. In 1988, however, the fundamental problems again became visible and enforced a change of the economic system. The privatisation strategy by the Treuhand by and large did not sell or restitute enterprises but sold plants out of the fragmented combines. Today, the visible deficit in headquarter function is the most important single obstacle against growth and wealth in the New Lander. It can be expected that this will only disappear within a new technology cycle.
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Industry Specialization, Diversity and the Efficiency of Regional Innovation Systems
Michael Fritsch, Viktor Slavtchev
Determinants of Innovative Behaviour,
2008
Abstract
Innovation processes are characterized by a pronounced division of labor between actors. Two types of externality may arise from such interactions. On the one hand, a close location of actors affiliated to the same industry may stimulate innovation (MAR externalities). On the other hand, new ideas may be born by the exchange of heterogeneous and complementary knowledge between actors, which belong to different industries (Jacobs’ externalities). We test the impact of both MAR as well as Jacobs’ externalities on innovative performance at the regional level. The results suggest an inverted u-shaped relationship between regional specialization in certain industries and innovative performance. Further key determinants of the regional innovative performance are private sector R&D and university-industry collaboration.
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Globalisation Forces an Acceleration of Standardization Processes
Ulrich Blum, Henry Dannenberg
Wirtschaft im Wandel,
No. 8,
2008
Abstract
The increase in the intensity of competition in recent years, especially in markets for industrial products, has increased the pressure for businesses to innovate. This finds expression in an accelerated introduction of new products and processes, leading to a shortening of product life cycles. Equally, the pressure to innovate also increased the pressure on research and development processes of businesses.
For this reason, the patent system and the standardization system get under pressure, because these systems for codifying and saving intellectual property rights need time for necessary inspections and to reach a consensus on different proposed specifications. This article focuses on the standardization system. Under the condition of temporal pressure, there are three possibilities for standardization: abstaining from standardization, switch to non consensus-based industrial standardization or accelerate the standardization process. This article examines if standardization organisations have successfully accelerated their processes to survive in the sandwich position between shortened product cycles and accelerated market introduction of products. It turns out that the acceleration has succeeded – through a series of institutional reforms, such as a prioritization of international before the national standards by the beginning and middle of the last decade agreements.
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Wie effektiv sind Technologie- und Gründerzentren in den Neuen Bundesländern?
Michael Schwartz
List Forum für Wirtschafts- und Finanzpolitik,
2008
Abstract
In Eastern Germany, since the beginning of the 1990s technology centers and business incubators are established by cities and municipalities to provide a favorable business environment for young and newly founded innovative firms. Right from the beginning, the effectiveness of these support facilities has been the subject of intense academic and policy discussions, but empirical evidence on the actual effectiveness of these centers is limited so far. Taking into account that the choice of the appropriate criteria for evaluations of the effectiveness of technology centers and business incubators is far from clear cut, this article focuses on three core indicators that are generally accepted as measures for effectiveness (incubation time, share of newly founded firms in the tenant portfolio and technological level of the supported firms), and analyses for five business incubators in East Germany whether they can be characterized as being effective policy instruments. A positive assessment of the five incubators’ effectiveness can be made with regard to average incubation time of tenant companies, as well as insofar the share of newly founded firms on all supported companies is concerned. However, deficiencies are found regarding the technological level of the incubator firms.
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Wirtschaftspolitische Beratung im Zeichen der Transformation: das Institut für Wirtschaftsforschung Halle
Ulrich Blum, Martin T. W. Rosenfeld
Zeitschrift für Politikberatung,
2008
Abstract
The paper analyzes the role of scientific policy advice in modern democratic societies in general and the role of the Halle Institute for Economic Research as one of the major German economic research institutes in particular. It shows that public funded institutions must be politically independent in order to turn theory and evidence based knowledge into political advice. Typical communication channels are contract research and public hearings as well as publications in economic policy journals, a frequent presence in other print media, radio, television and internet.
The Halle Institute for Economic Research focuses on macroeconomic analyses and forecasting. In addition it scrutinizes structural change and transformation processes from a regional, innovation system, competition and urban perspective.
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How Does Industry Specialization Affect the Efficiency of Regional Innovation Systems?
Michael Fritsch, Viktor Slavtchev
Jena Economic Research Papers, Nr. 2008-058,
No. 58,
2008
Abstract
This study analyzes the relationship between the specialization of a region in certain industries and the efficiency of the region in generating new knowledge. The efficiency measure is constructed by relating regional R&D input and output. An inversely u-shaped relationship is found between regional specialization and R&D efficiency, indicating the presence of externalities of both Marshall and Jacobs’ type. Further factors influencing efficiency are spillovers within the private sector as well as from public research institutions. The impact of both the specialization and the additional factors is, however, different for regions at different efficiency levels.
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Preventing Innovative Cooperations: The Legal Exemptions Unintended Side Effect
Christian Growitsch, Nicole Nulsch, Margarethe Rammerstorfer
IWH Discussion Papers,
No. 6,
2008
Abstract
In 2004, European competition law had been faced with considerable changes due to the introduction of the new Council Regulation No. 1/2003. One of the major renewals was the replacement of the centralized notification system for inter-company cooperations in favor of a so-called legal exemption system. We analyze the implications of this reform on the agreements firms implement. In contrast to previous research we focus on the reform’s impact on especially welfare enhancing, namely innovative agreements. We show that the law’s intention to reduce the incentive to establish illegal cartels will be reached. However, by the same mechanism, also highly innovative cooperations might be prevented. To avoid this unintended effect, we conclude that only fines but not the monitoring activities should be increased in order to deter illegal but not innovative agreements.
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Foreign Subsidiaries in the East German Innovation System – Evidence from Manufacturing Industries
Jutta Günther, Björn Jindra, Johannes Stephan
IWH Discussion Papers,
No. 4,
2008
Abstract
This paper analyses the extent of technological capability of foreign subsidiaries located in East Germany, and looks at the determinants of foreign subsidiaries’ technological sourcing behaviour. The theory of international production underlines the importance of strategic and regional level variables. However, existing empirical approaches omit by and large regional level factors. We employ survey evidence from the “FDI micro data- base” of the IWH, that was only recently made available, to conduct our analyses. We find that foreign subsidiaries are above average technologically active in comparison to the whole East German manufacturing. This can be partially explained by the industrial structure of foreign direct investment. However, only a limited share of foreign subsidiaries with R&D and/or innovation activity source technological knowledge from the East German innovation system. If a subsidiary follows a competence augmenting strategy or does local trade, it is more likely to source technological knowledge locally. The endowment of a region with human capital and a scientific infrastructure has a positive effect too. The findings suggest that foreign subsidiaries in East Germany are only partially linked with the regional innovation system. Policy implications are discussed.
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Culture as a Base for Efficient Economic Systems
Ulrich Blum
Wirtschaft im Wandel,
No. 2,
2008
Abstract
Globalization puts the German economic model, the so-called social market economy, under pressure. Constituting elements of this model are fundamental social and economic values. Globalization puts some of these values under pressure and creates inefficiencies because the costs of running the social and economic fabric rise. This is an important justification to inquire into the normative foundations of economic efficiency The following article discusses to what extent culture is a base for efficient economic systems. Information theory is regarded as a key element for explaining social change. The arguments are based on institutional economics with a special view on transaction costs and on cooperation structures. It is shown that specific information technologies promote forms of cooperation, which influence institutional arrangements. The related information technologies themselves are part of the cultural system and its value structures. As a consequence, competition among economic systems favours certain combinations of technologies, cultural arrangements and economic systems. In as much as cultural competition precedes economic competition in the sense of a certain way of thinking, the cultural system can be regarded as a strategic competitive parameter for an economy.
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