Initial conditions and regional performance in the aftermath of disruptive shocks: the case of East Germany after socialism

The knowledge spillover theory of entrepreneurship

Michael Fritsch () and Michael Wyrwich

Industrial and Corporate Change, 2022, vol. 31, issue 6, 1428-1459

Abstract: We investigate how specific regional conditions found in East Germany at the end of the socialist regime impact development during the turbulent shock transition to a market economy. Both the self-employment rate (an indicator of a pre-socialist entrepreneurial tradition) and the share of the workforce with a university degree (as measure of the general qualification of the workforce) have a strong positive effect on regional development. Our results show that entrepreneurship and knowledge are key regional resources for mastering disruptive historical shocks.

Date: 2022
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Working Paper: Initial Conditions and Regional Performance in the Aftermath of Disruptive Shocks: The Case of East Germany after Socialism (2020)
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