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Business environment and enterprise behaviour in East Germany compared to West Germany and Central Europe

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  • Krkoska, Libor
  • Robeck, Katrin

Abstract

This paper examines institutional differences between East and West Germany and four Central European transition countries (Czech Republic, Hungary, Poland and Slovak Republic). Using enterprise survey data we show that institutional performance in East Germany is significantly different from West Germany. In addition, Central European transition countries are shown to have a similar institutional quality as East Germany in many areas. We also show that enterprises in the Central European transition countries have strongly focused on company level innovation and investment in human capital. Meanwhile, East German enterprises report investments in new products and processes as well as in skills well below the level of not only West Germany but also the Central European transition countries. Journal of Comparative Economics 36 (4) (2008) 568-583.

Suggested Citation

  • 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.
  • Handle: RePEc:eee:jcecon:v:36:y:2008:i:4:p:568-583
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    References listed on IDEAS

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    1. Lechner, Michael & Wunsch, Conny, 2006. "Active Labour Market Policy in East Germany: Waiting for the Economy to Take Off," CEPR Discussion Papers 5924, C.E.P.R. Discussion Papers.
    2. Andrea Boltho & Wendy Carlin & Pasquale Scaramozzino, 1999. "Will East Germany become a new Mezzogiorno?," Chapters,in: Economic Growth and Change, chapter 13 Edward Elgar Publishing.
    3. Sinn, Hans-Werner, 2002. "Germany's Economic Unification: An Assessment after Ten Years," Review of International Economics, Wiley Blackwell, vol. 10(1), pages 113-128, February.
    4. George A. Akerlof & Andrew K. Rose & Janet L. Yellen & Helga Hessenius, 1991. "East Germany in from the Cold: The Economic Aftermath of Currency Union," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 22(1), pages 1-106.
    5. Rainer, Helmut & Siedler, Thomas, 2009. "Does democracy foster trust?," Journal of Comparative Economics, Elsevier, vol. 37(2), pages 251-269, June.
    6. Ragnitz, Joachim, 2007. "Explaining the East German productivity gap: the role of human capital," Kiel Working Papers 1310, Kiel Institute for the World Economy (IfW).
    7. Jennifer Hunt, 2006. "Staunching Emigration from East Germany: Age and the Determinants of Migration," Journal of the European Economic Association, MIT Press, vol. 4(5), pages 1014-1037, September.
    8. Kronthaler, Franz, 2003. "A Study of the Competitiveness of Regions based on a Cluster Analysis: The Example of East Germany," IWH Discussion Papers 179, Halle Institute for Economic Research (IWH).
    9. Erik Lehmann & Doris Neuberger & Solvig R”thke, 2004. "Lending to Small and Medium-Sized Firms: Is There an East-West Gap in Germany?," Small Business Economics, Springer, vol. 23(1), pages 23-39, August.
    10. Franz Kronthaler, 2003. "A Study of the Competitiveness of Regions based on a Cluster Analysis: The Example of East Germany," ERSA conference papers ersa03p27, European Regional Science Association.
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    Cited by:

    1. Silviu DU?ULESCU & Ileana NI?ULESCU-ASHRAFZADEH, 2016. "Corruption in Romania," The Audit Financiar journal, Chamber of Financial Auditors of Romania, vol. 14(138), pages 680-680, June.
    2. Cosmin Marinescu, 2013. "Institutional Quality of the Business Environment: Some European Practices in a Comparative Analysis," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 15(33), pages 270-287, February.
    3. Cosmin Marinescu & Octavian-Dragomir Jora, 2013. "Assessment on the “institutional economics” of corruption. Business and development in Romania, between formal and informal practices," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 15(Special 7), pages 603-616, November.

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