International Fragmentation of Production and the Labour Input into Germany’s Exports – An Input-Output-analysis
Hans-Ulrich Brautzsch, Udo Ludwig
IWH Discussion Papers,
Nr. 14,
2011
Abstract
The import penetration of exports has become a topic of public debate, particularly in the context of Germany’s position as one of the world’s leading exporters. The growth in the volume of intermediate products purchased from abroad for subsequent processing into export goods in Germany seems to be undermining the importance of exports as a driver of domestic production and employment. The gains that arise from an increase in exports seem to have been offset by the losses caused by the crowding out of local production by imports. Empirical evidence on the impact of this international integration of the goods market on the German labour market is ambiguous. Short-term negative effects on employment are claimed to be offset by the long-term benefit that the jobs lost in the short run will eventually be replaced by higher-skilled jobs with better
perspectives. Against this background, the following hypothesis is tested empirically: Germany is poor in natural resources, but rich in skilled labour. In line with the Heckscher- Ohlin theory, Germany should therefore specialize in the production of export goods and services that are relatively intensive in these factors and should import those goods and services that are relatively intensive in unskilled labour. The empirical part of the paper deals with the extent of the German export penetration by imports. At first, it analyses by what ways imports are affecting the exports directly and indirectly and shows the consequences of import penetration of exports for the national output and employment. Secondly, consequences for employment are split in different skill types of labour. These issues are discussed with the standard open static inputoutput- model. The data base is a time series of official input-output tables. The employment effects for Germany divided by skill types of labour are investigated using skill matrices generated by the authors.
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The impact of institutions on the employment performance in European labour markets, 1979 - 2001
Christian Dreger
Einzelveröffentlichungen,
Nr. 3,
2006
Abstract
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What Drives FDI in Central-eastern Europe? Evidence from the IWH-FDI-Micro Database
Andrea Gauselmann, Mark Knell, Johannes Stephan
Post-Communist Economies,
Nr. 3,
2011
Abstract
The focus of this paper is on the match between strategic motives of foreign investments into Central-Eastern Europe and locational advantages offered by these countries. Our analysis makes use of the IWH-FDI-Micro Database, a unique dataset that contains information from 2009 about the determinants of locational factors, technological activity of the subsidiaries, and the potentials for knowledge spillovers in the Czech Republic, Hungary, Poland, Romania, and Slovakia. The analysis suggests that investors in these countries are mainly interested in low (unit) labour costs coupled with a well-trained and educated workforce and an expanding market with the high growth rates in the purchasing power of potential buyers. It also suggests that the financial crisis reduced the attractiveness of the region as a source for localised knowledge and technology. There appears to be a match between investors’ expectations and the quantitative supply of unqualified labour, not however for the supply of medium qualified workers. But the analysis suggests that it is not technology-seeking investments that are particularly content with the capabilities of their host economies in terms of technological cooperation. Finally, technological cooperation within the local host economy is assessed more favourably with domestic firms than with local scientific institutions – an important message for domestic economic policy.
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Economic Structure and Regional Performance in Germany, 2002-2007
Alexander Kubis, Matthias Brachert, Mirko Titze
European Planning Studies,
Nr. 2,
2012
Abstract
This paper explores the impact of industrial clusters on regional growth at the German labour market region level using a regional convergence model. Based on the results of an exploratory study of the geography of German industrial clusters, we are able to differentiate the impact of industrial clustering from a horizontal and a vertical perspective while taking regional convergence into consideration. The results indicate that in addition to an all-German process of convergence, a specific East German one can be identified. The different types of industrial clusters show mixed effects within this framework. While vertically isolated industrial clusters have a negative impact on regional growth in this period, positive growth effects can be identified when industrial clusters show an intra-regional vertical interconnectedness.
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Monopsonistic Labour Markets and the Gender Pay Gap: Theory and Empirical Evidence
Boris Hirsch
Lecture Notes in Economics and Mathematical Systems,
Nr. 639,
2010
Abstract
This book investigates models of spatial and dynamic monopsony and their application to the persistent empirical regularity of the gender pay gap. Theoretically, the main conclusion is that employers possess more monopsony power over their female employees if women are less driven by pecuniary considerations in their choice of employers than men. Employers may exploit this to increase their profits at the detriment of women’s wages. Empirically, it is indeed found that women’s labour supply to the firm is less wage-elastic than men’s and that at least a third of the gender pay gap in the data investigated may result from employers engaging in monopsonistic discrimination. Therefore, a monopsonistic approach to gender discrimination in the labour market clearly contributes to the economic understanding of the gender pay gap. It not only provides an intuitively appealing explanation of the gap from standard economic reasoning, but it is also corroborated by empirical observation.
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The Gender Pay Gap under Duopsony: Joan Robinson meets Harold Hotelling
Boris Hirsch
Scottish Journal of Political Economy,
Nr. 5,
2009
Abstract
This paper presents an alternative explanation of the gender pay gap resting on a simple Hotelling-style duopsony model of the labour market. Since there are only two employers, equally productive women and men have to commute and face travel cost to do so. We assume that some women have higher travel cost, e.g., due to more domestic responsibilities. Employers exploit that women on average are less inclined to commute and offer lower wages to all women. Since women's firm-level labour supply is for this reason less wage-elastic, this model is in line with Robinson's explanation of wage discrimination.
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Globalisation and the Competitiveness of the Euro Area
Filippo di Mauro, Katrin Forster
ECB Occasional Paper Series,
Nr. 97,
2008
Abstract
Against the background of increasing competition and other significant structural changes implied by globalisation, maintaining and enhancing competitiveness has evolved into one of the prime concerns in most countries. Following up on previous work (see in particular ECB Occasional Papers No. 30 and No. 55), this Occasional Paper examines the latest developments and prospects for the competitiveness and trade performance of the euro area and the euro area countries. Starting from an analysis of most commonly used, traditional competitiveness indicators, the paper largely confirms the findings of previous studies that there have been substantial adjustments in euro area trade. Euro area firms have taken advantage of the new opportunities offered by globalisation, and have at the same time been increasingly challenged by emerging economies. This is primarily reflected in the loss of export market shares which have been recorded over the last decade. While these can partly be related to the losses in the euro area's price competitiveness, further adjustment also seems warranted with regard to the export specialisation. Compared with other advanced competitors, the euro area remains relatively more specialised in labour intensive categories of goods and has shown only a few signs of a stronger specialisation in research-intensive goods. Nevertheless, the paper generally calls for a more cautious approach when assessing the prospects for euro area competitiveness, as globalisation has made it increasingly difficult to define and measure competitiveness. Stressing the need to take a broader view on competitiveness, specifically with a stronger emphasis on productivity performance, the paper also introduces a more elaborate framework that takes into account the interactions between country-specific factors and firm-level productivity. It thus makes it possible to construct more broadly defined competitiveness measures. Pointing to four key factors determining the global competitiveness of euro area countries - market accessibility, market size, technological leadership of firms and institutional set-up - the analysis provides further arguments for continuing efforts to increase market integration and strengthen the competitive environment within Europe as a mean of enhancing resource allocation and coping with the challenges globalisation creates.
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The Achilles Heel of the EMU: The Labour Markets
Hubert Gabrisch
Einzelveröffentlichungen,
Nr. 1,
2008
Abstract
Recent diverging labour cost developments among EMU countries, affecting the trade and inflation position of each country, raise some doubts regarding the equal distribution of costs and benefits of shocks among the member countries and, hence, the long term stability of the Euro.
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The Role of the Human Capital and Managerial Skills in Explaining the Productivity Gaps between East and West
Wolfgang Steffen, Johannes Stephan
IWH Discussion Papers,
Nr. 11,
2007
Abstract
This paper assess determinants of productivity gaps between firms in the European transition countries and regions and firms in West Germany. The analysis is conducted at the firm level by use of a unique database constructed by field work. The determinants tested in a simple econometric regression model are focussed upon the issue of human capital and modern market-oriented management. The results are novel in as much as a solution was established for the puzzling results in related research with respect to a comparison of formal qualification between East and West. Furthermore, the analysis was able to establish that the kind of human capital and expertise mostly needed in the post-socialist firms are related to the particular requirements of a competitive marketbased economic environment. Finally, the analysis also finds empirical support for the role of capital deepening in productivity catch-up, as well as the case that the gaps in labour productivity are most importantly rooted in a more labour-intense production, which does not give rise to a competitive disadvantage.
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