Ten years after the unification: East Germany and the relevance of modern theories of trade, location and growth

Steven Brakman, Harry Garretsen and Marc Schramm
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Marc Schramm: Groningen University

No 00C04, Research Report from University of Groningen, Research Institute SOM (Systems, Organisations and Management)

Abstract: In the paper we analyse, ten years after the German unification, the relevance of modern theoretical developments on trade, location and growth for East Germany using sectoral and regional data. Given our discussion of stylized facts about industry growth, economies of scale and differences in labour productivity we test for the existence of localised knowledge spillovers and a spatial wage structure in East Germany. We find that localised knowledge spillovers play a role and that a spatial wage structure exists in East Germany.

Date: 1999
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