Does administrative status matter for urban growth? Evidence from present and former county capitals in East Germany

Bastian Heider, Albrecht Kauffmann () and Martin T. W. Rosenfeld

No 24/2016, IWH Discussion Papers from Halle Institute for Economic Research (IWH)

Abstract: Public sector activities are often neglected in the economic approaches used to analyze the driving forces behind urban growth. The institutional status of a regional capital is a crucial aspect of public sector activities. This paper reports on a quasi-natural experiment on county towns in East Germany. Since 1990, cities in East Germany have demonstrated remarkable differences in population development. During this same period, many towns have lost their status as a county seat due to several administrative reforms. Using a difference-in-difference approach, the annual population development of former county capitals is compared to population change in towns that have successfully held on to their capital status throughout the observed period. The estimations show that maintaining county capital status has a statistically significant positive effect on annual changes in population. This effect is furthermore increasing over time after the implementation of the respective reforms.

Keywords: urban economic growth; centrality; institutions; public sector; East Germany; post-socialist cities; capital cities; county towns; county government reform (search for similar items in EconPapers)
JEL-codes: H1 H7 P2 R1 R5 (search for similar items in EconPapers)
Date: 2016, Revised 2016
New Economics Papers: this item is included in nep-eur and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Does Administrative Status Matter for Urban Growth? Evidence from Present and Former County Capitals in East Germany (2018)
Working Paper: Does administrative status matter for urban growth? Evidence from present and former county capitals in East Germany (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:iwhdps:242016

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