A Study of the Competitiveness of Regions based on a Cluster Analysis: The Example of East Germany
AbstractThis paper examines whether some East German regions have already achieved the same economic capability as the regions in West Germany, so that they are on a competitive basis with the West German regions and are able to reach the same economic level in the long run. If this is not the case, it is important to know more about the reasons for the economic weakness of the East German regions twelve years after unification. The study is based on a cluster analysis. Criteria for the cluster formation are several economic indicators, which provide information about the economic capability of regions. The choice of the indicators is based on a review of results of the theoretical and empirical literature on the new growth theory and new economic geography. The results show that most of the East German regions have not yet reached the economic capability and competitiveness of their West German counterparts so that they - from the viewpoint of the new growth theory and the new economic geography - are not in the position to reach the same economic level. According to these theories economic disadvantages are most notably the consequences of less technical progress, a lack of entrepreneurship and fewer business concentration. Under these points it is especially noteworthy that young well educated people leave these East German regions so that human capital might will turn into a bottle-neck in the near future. Only a few regions in East Germany - those with important agglomerations - are comparable to West German regions that are characterised by average capability and competitiveness, but not to those with above average economic capability and competitiveness. Even those more advanced East German regions still suffer from a slower technical progress. There are important policy implications based on these results: regional policy in East Germany was not able to assist raising all regions to a sufficient level of competitiveness. It may be more effective to concentrate the regional policy efforts on a selection of important agglomerations. This has also strong implications for the EU regional policy assuming that the accession countries will have similar problems in catching up to the economic level of the EU as have the East German regions.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Halle Institute for Economic Research in its series IWH Discussion Papers with number 179.
Date of creation: Aug 2003
Date of revision:
regional disparities; competitiveness; cluster analysis; East Germany; EU-enlargement;
Find related papers by JEL classification:
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
- P52 - Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies
- O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Romer, Paul M, 1990.
"Endogenous Technological Change,"
Journal of Political Economy,
University of Chicago Press, vol. 98(5), pages S71-102, October.
- Aghion, Philippe & Howitt, Peter, 1992.
"A Model of Growth through Creative Destruction,"
Econometric Society, vol. 60(2), pages 323-51, March.
- Aghion, P. & Howitt, P., 1990. "A Model Of Growth Through Creative Destruction," DELTA Working Papers 90-12, DELTA (Ecole normale supérieure).
- Aghion, P. & Howitt, P., 1989. "A Model Of Growth Through Creative Destruction," Working papers 527, Massachusetts Institute of Technology (MIT), Department of Economics.
- Aghion, P. & Howitt, P., 1989. "A Model Of Growth Through Creative Destruction," UWO Department of Economics Working Papers 8904, University of Western Ontario, Department of Economics.
- Philippe Aghion & Peter Howitt, 1990. "A Model of Growth Through Creative Destruction," NBER Working Papers 3223, National Bureau of Economic Research, Inc.
- Robert J. Barro, 1988.
"Government Spending in a Simple Model of Endogenous Growth,"
NBER Working Papers
2588, National Bureau of Economic Research, Inc.
- Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages S103-26, October.
- Barro, Robert J., 1990. "Government Spending in a Simple Model of Endogeneous Growth," Scholarly Articles 3451296, Harvard University Department of Economics.
- Barro, R.J., 1988. "Government Spending In A Simple Model Of Endogenous Growth," RCER Working Papers 130, University of Rochester - Center for Economic Research (RCER).
- Gianmarco I. P. Ottaviano & Diego Puga, 1998.
"Agglomeration in the Global Economy: A Survey of the 'New Economic Geography',"
The World Economy,
Wiley Blackwell, vol. 21(6), pages 707-731, 08.
- Ottaviano, Gianmarco Ireo Paolo & Puga, Diego, 1997. "Agglomeration in the Global Economy: A Survey of the 'New Economic Geography'," CEPR Discussion Papers 1699, C.E.P.R. Discussion Papers.
- Romer, Paul M, 1986.
"Increasing Returns and Long-run Growth,"
Journal of Political Economy,
University of Chicago Press, vol. 94(5), pages 1002-37, October.
- Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
- Bode, Eckhardt, 1996. "Ursachen regionaler Wachstumsunterschiede: wachstumstheoretische Erklärungsansätze," Kiel Working Papers 740, Kiel Institute for the World Economy.
- Lotero Contreras, Jorge & Posada Duque, Héctor Mauricio & Valderrama, Daniel, 2009. "Competitiveness of Colombian Departments observed from an Economic geography Perspective," BORRADORES DEPARTAMENTO DE ECONOMÃA 005519, UNIVERSIDAD DE ANTIOQUIA - CIE.
- Wolfgang Nagl, 2014. "Lohnrisiko und Altersarmut im Sozialstaat," ifo Beiträge zur Wirtschaftsforschung, Ifo Institute for Economic Research at the University of Munich, number 54, July.
- Wolfgang Nagl & Stefan Arent, 2012. "Unemployment Benefits and Wages: Evidence from the German Hartz-Reform," ERSA conference papers ersa12p78, European Regional Science Association.
- Stefan Arent & Wolfgang Nagl, 2011. "Unemployment Benefit and Wages: The Impact of the Labor Market Reform in Germany on (Reservation) Wages," Ifo Working Paper Series Ifo Working Paper No. 101, Ifo Institute for Economic Research at the University of Munich.
- Krkoska, Libor & Robeck, Katrin, 2008. "Business environment and enterprise behaviour in East Germany compared to West Germany and Central Europe," Journal of Comparative Economics, Elsevier, vol. 36(4), pages 568-583, December.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Hubert Gabrisch).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.