Specialization, Diversity, Competition and their Impact on Local Economic Growth in Germany
Martin T. W. Rosenfeld, Annette Illy, Michael Schwartz, Christoph Hornych
Abstract
This study systematically examines the impact of fundamental elements of urban economic structure on urban growth in Germany from 2003 to 2007. We test four elements simultaneously, that is sectoral specialization, diversification of economic activities, urban size as well as the impact of local competition. To account for the effect of varying spatial delimitations in the analysis of urban growth, we further differentiate between cities and planning regions as geographical units. The analysis covers manufacturing industries as well as service sectors. Most previous work produces inconsistent results and concentrates on localization economies and/or diversification, while urban size and the effect of local competition are widely ignored. Our regression results show a U-shaped relationship between localization economies and urban growth and positive effects of local competition on urban growth. With respect to diversification, we find positive effects on urban growth on the city-level, but insignificant results on the level of the planning regions. The impact of urban size also differs between free cities and planning regions; in the former a U-shaped relationship is found whereas the effect is inversely U-shaped for the latter.
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Knowledge Spill-overs for Knowledge-based Development: Progression in Theory and Obstacles for Empirical Research
Peter Franz
International Journal of Knowledge-Based Development,
2010
Abstract
As scientists and policymakers tend to interpret changes in the economy as a trend towards an increasingly knowledge-based economy, their recommendations and strategies for regional economic development frequently contain elements how to intensify the knowledge flows in the region concerned. Knowledge flows come into existence from intentional action, but also in an unintended way as externalities or knowledge spillovers. This paper reviews the ways regional and urban economics has dealt with the concept of knowledge spillovers. Knowledge spillovers are defined within a conceptual framework that points out different uses of knowledge in economics. The concept’s operationalisations in diverse empirical studies are systematised and discussed. After a critical review of the current state of research, policy strategies aiming to intensify knowledge spillovers are classified. The paper concludes with an outlook on promising new approaches to research knowledge spillovers and on the elaboration of more efficient policy strategies.
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Cross-border Diversification in Bank Asset Portfolios
Claudia M. Buch, J.C. Driscoll, C. Ostergaard
International Finance,
forthcoming
Abstract
We compute optimally diversified international asset portfolios for banks located in France, Germany, Italy, the United Kingdom and the United States using the mean–variance portfolio model with currency hedging. We compare these benchmark portfolios with the actual cross-border asset positions of banks from 1995 to 2003 and ask whether the differences are best explained by regulations, institutions, cultural conditions or other financial frictions. Our results suggest that both culture and regulations affect the probability of a country's being overweighted in banks' portfolios: countries whose residents score higher on a survey measure of trust are more likely to be overweighted, while countries that have tighter capital controls are less likely to be overweighted. From a policy standpoint, the importance of culture suggests a limit to the degree of financial integration that may be achievable by the removal of formal economic barriers.
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May Cities in De-Industrialized Regions Become Hot Spots for Attracting Cultural Businesses? The Case of Media Industry in Halle an der Saale (Germany)
Christoph Hornych, Martin T. W. Rosenfeld
European Planning Studies,
2010
Abstract
Policy-makers from many regions where old industrial structures in the field of manufacturing have collapsed are trying to stimulate entrepreneurial activities of businesses in the cultural industry. The question is whether this strategy could be successful. This article examines the strategy of supporting the sector of media industry (“MI”) by policy-makers in the region of Halle in East Germany, where a strong de-industrialization has taken place after the German reunification. Stimulated by the policy-makers' support measures, there actually was a remarkable development of MI. However, the number of MI firms and their employees did not further increase in recent years, after having reached a certain level. This illustrates the limits of political measures for turning a city's path of industrial development voluntarily.
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Industry Concentration and Regional Innovative Performance – Empirical Evidence for Eastern Germany
Christoph Hornych, Michael Schwartz
Post-Communist Economies,
2009
Abstract
Regarding technological innovativeness, the transformed economy of the former German Democratic Republic (GDR) clearly lags behind the western part of the country. To face this weakness a broad mixture of policy measures was carried out in recent years. Particular attention is drawn to the development of industry concentrations and economic ‘clusters’. However, little is known about the effectiveness of these policy measures regarding how industry concentrations in fact promote innovative performance in Eastern Germany. The present study tries to fill this gap by analysing the relationship between industry concentration in Eastern Germany and regional innovative performance. Our empirical analysis is based upon the number of patent applications of 22 manufacturing industries in 22 Eastern German planning regions. The estimated regression models indicate an inverted-U relationship between the degree of industry concentration and innovative performance. An exceedingly high degree of industry concentration in one region hampers regional innovative output. We discuss policy implications of our findings and give recommendations for future refinement of ‘cluster’-supporting policy schemes in Eastern Germany.
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International Climate Policy after Kyoto – Economic Challenges Ahead
Wilfried Ehrenfeld
Wirtschaft im Wandel,
No. 12,
2009
Abstract
Die Evidenz nimmt zu, dass der Anstieg der Treibhausgasemissionen seit Beginn des 20. Jahrhunderts die globale Durchschnittstemperatur zunehmen lässt. Eine Begrenzung des Temperaturanstiegs auf 2°C soll zumindest die schwerwiegendsten Folgen der globalen Erwärmung vermeiden. Dazu müssten die Treibhausgasemissionen bis spätestens zum Jahr 2015 ihren Maximalwert erreicht haben und von da an bis zum Jahr 2050 weltweit drastisch reduziert werden.
Aus ökonomischer Sicht ergeben sich eine Reihe bedeutsamer Fragenkomplexe:
Wie ist zunächst die Ausgangslage in wirtschaftlichen Kategorien zu beschreiben? Hierzu sind vorab die Emissionen nach Regionen und Sektoren aufzuzeigen, um daraufhin die Anpassungsmöglichkeiten beschreiben zu können.
Welche Kosten und welche Erträge sind mit einer Klimapolitik verbunden? So liegt die Bandbreite des geschätzten Schadens im Fall eines ungebremsten Klimawandels zwischen jährlich 5% und 20% des weltweiten Bruttoinlandsprodukts (BIP); dem stehen Schätzungen von rund 1% des globalen BIP gegenüber, die zur Stabilisierung der Konzentration von Treibhausgasen in der Atmosphäre aufzuwenden wären.
Wie sind die globalen Ziele regional und sektoral zu verteilen und welche ökonomischen Instrumente sind hierfür zu empfehlen? Offensichtlich werden handelbare Emissionslizenzen präferiert, womit Ausgangszuteilungen und die Art der Zuteilung einerseits, die Handelbarkeit andererseits eine herausragende Rolle spielen.
Welche politökonomischen Konflikte ergeben sich und welche Empfehlungen können Ökonomen geben, um diese zielorientiert zu lösen? Was ist abschließend wirtschaftspolitisch zu empfehlen, um insbesondere im Sinne des Abschlusses eines internationalen Klimaabkommens glaubhaft zu bleiben?
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Urban Growth in Germany – The Impact of Localization and Urbanization Economies
Christoph Hornych, Michael Schwartz, Annette Illy, Martin T. W. Rosenfeld
IWH Discussion Papers,
No. 19,
2009
Abstract
This study examines the impact of localization and urbanization economies as well as the impact of city size on urban growth in German cities from 2003 to 2007. Although, from a theoretical perspective, agglomeration economies are supposed to have positive impacts on regional growth, prior empirical studies do not show consistent results. Especially little is known about agglomeration economies in Germany, where interregional support policy and the characteristics of the federal system are further determinants of urban growth. The results of the econometric analysis show a U-shaped relationship between specialization and urban growth, which particularly holds for manufacturing industries. We do not find evidence for the impact of Jacobs-externalities; however, city size shows a positive (but decreasing) effect on urban growth.
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Book Review on: Mahmound A.T. Elkhafif, Exchange Rate Policy and Currency Substitution: The Case of Africa’s Emerging Economies, 2002, Economic Research Papers No. 71, Abidjan: African Development Bank
Tobias Knedlik
African Development Perspectives Yearbook: Private and Public Sectors: Towards a Balance,
2004
Abstract
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