Browsing by Subject "Wirtschaftsentwicklung"

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Decomposing a decomposition : within-country differences and the role of structural change in productivity growth
(2019) Mühlen, Henning; Escobar, Octavio
In this article, we investigate the relevance of structural change in country wide productivity growth considering within-country differences. For this purpose, we propose a two-step decomposition approach that accounts for differences among subnational units. To highlight the relevance of our procedure compared to the prevalent approach in the existing development literature (which usually neglects subnational differences), we show an application with data for the Mexican economy. Specifically, we contrast findings obtained from country-sector data on the one hand with those obtained from (more disaggregated) state-sector data on the other hand. One main insight is that the qualitative and quantitative results differ substantially between the two approaches. Our procedure reveals that structural change appeared to be growth-reducing during the period from 2005 to 2016. We show that this negative effect is driven mainly by the reallocation of (low-skilled) labor within subnational units.
Does medieval trade still mater? Historical trade centers, agglomeration and contemporary economic development
(2013) Wahl, Fabian
This study empirically establishes a link between medieval trade, agglomeration and contemporary regional development in ten European countries. It documents a statistically and economically significant positive relationship between prominent involvement in medieval trade and commercial activities and regional economic development today. Further empirical analyses show that medieval trade positively influenced city development both during the medieval period and in the long run; they also reveal a robust connection between medieval city growth and contemporary regional agglomeration and industry concentration. A mediation analysis indicates that a long-lasting effect of medieval trade on contemporary regional development is indeed transmitted via its effect on agglomeration and industry concentration. This research thus highlights the long-run importance of medieval trade in shaping the development of cities as well as the contemporary spatial distribution of economic activity throughout Europe. The path-dependent regional development processes caused by medieval commercial activities help explain the observed persistent regional development differences across the European countries considered.
Endogenous technology, matching, and labor unions : does low-skilled immigration affect the technological alignment of the host country?
(2017) Cords, Dario
In recent years, Germany and other European countries face the strongest immigration flow in their history. Experts unanimously agree that one of the core factors of a successful social integration is the labor market participation of the new arrivals. This paper investigates the impact of low-skilled immigration on a unionized economy with labor market frictions. It especially examines how immigration affects the technology choice of firms and, thereby, the technological alignment of the host country. The labor market is characterized by heterogeneity on both sides of the market. Within this framework, it can be shown that low-skilled immigration encourages firms to invest more in a basic technology, which leads to a deterioration of the technology level in the whole economy. It can be further shown that policies, which improve the access of already existing low-skilled immigrants to the labor market counteract the effect that is triggered by an increase in low-skilled immigration.
Foreign patenting in Germany, 1877 - 1932
(2010) Streb, Jochen; Degner, Harald
In this paper, we use both patents? individual life span and foreign patenting activities in Germany to identify the most valuable patents of the 21 most innovative countries (except for Germany) from the European Core, the European periphery and overseas between 1877 and 1932. Our empirical analysis reveals that important characteristics of the international distribution of foreign patents are time-invariant. In particular, the distribution of foreign patents across countries in the late nineteenth and early twentieth centuries was as highly skewed as it was in the late twentieth century ? and even dominated by the same major research economies. Our analysis suggests that firms? technological advantages were influenced both by exogenous local factors, such as the countries? resource endowment, and by endogenous factors, such as the national education and research system or the countries? actual stage of economic development.
Generalized barriers to entry and economic development
(2009) Pyka, Andreas; Saviotti, Pier Paolo
In this paper we are going to analyze the dynamics of barriers to entry at the international level. In our model economic development takes place and continues in the long run due to the emergence of new sectors, which can compensate for the diminishing ability of mature sectors to create employment and growth. Each new sector is created by a pervasive innovation, which creates a new market and into and out of which there are entry and exit of firms. Depending on the inter-temporal coordination of the maturation of older sectors and of the maturation of new ones our model can give rise to development paths with growth rates ranging from high to negative, to fluctuations, to bubbles and to chaos. In the construction of our model we found inspiration in a number of growth models, both endogenous and evolutionary as well as on empirical work on structural change. The model also bears some similarity of style to history friendly models. Its unique feature is that it gives rise to an endogenously variable number of sectors. Unless new sectors are exact substitutes of older ones the model gives rise to growing variety. In fact, the main objective for which the model was initially constructed was to test some propositions implying that variety growth is a necessary requirement for long term economic development. Within our model the ability to create new sectors at the right times is the crucial determinant of the growth potential of an economic system. Thus, inter country differences in the barriers to entry into new sectors can be expected to give rise to different rates of growth and in the end to increasingly skewed world income distribution.
Identifying smart strategies for economic diversification and inclusive growth in developing economies : the case of Paraguay
(2019) Pinheiro, Flávio L.; Bezerra, Mayra; Hartmann, Dominik
A country’s productive structure determines its future path of economic diversification, economic growth, and income inequality. In this article, we identify Paraguay’s structural constraints and opportunities for economic diversification and inclusive growth. For this purpose, we advance methods from research on economic complexity and the product space to estimate how feasible and desirable are different types of new products and economic diversification strategies for Paraguay. To estimate the feasibility of different diversification opportunities, we measure the revealed comparative advantages and relatedness of 763 SITC products to Paraguay’s current product structure. To estimate the desirability of each product, we measure the expected level of income, economic complexity, technology and income inequality associated with these products. Our results indicate that despite Paraguay’s strong dependence on primary goods and resource-based manufactures, it has significant opportunities to diversify into more complex, high-income, and inclusive products. These opportunities include manufacturing products related to agricultural activities (such as machines for harvesting or food-processing) as well as chemical products (such as medicaments and vaccines). We present a scoreboard of feasible and desirable product options that helps to discuss different diversification strategies. Paraguay could for instance (1) only focus on the relatedness criteria; (2) further develop the products with intermediate capabilities; (3) promote diversification into related, higher income products; or (4) push towards complex and inclusive industries. Our results imply that only focusing on feasibility may lead developing countries like Paraguay further into an economic development trap, consisting in the focus on simple products and the large distance to high complexity and low inequality products. Instead promoting products that combine minimum standards regarding both feasibility and desirability criteria might be the best strategy for smart diversification and inclusive growth.
Illuminating the World Cup effect : night lights evidence from South Africa
(2016) Pfeifer, Gregor; Wahl, Fabian; Marczak, Martyna
This paper evaluates the economic impact of the $14 billion preparatory investments for the 2010 FIFA World Cup in South Africa. We use satellite data on night light luminosity at municipality and electoral district level as a proxy for economic development, applying synthetic control methods for estimation. For the average World Cup municipality, we find significantly positive, short-run effects before the tournament, corresponding to a reduction of unemployment by 1.3 percentage points. At the electoral district level, we reveal distinct effect heterogeneity, where especially investments in transport infrastructure are shown to have long-lasting, positive effects, particularly in more rural areas.
Instabiltiy, economic stagnation and the role of Islam in the North Caucasus
(2011) Dobler, Constanze
Since the breakup of the Soviet Union, the North Caucasus is known as a politically unstable region and as a melting pot for terrorism and all kinds of criminal activity, reaching from drugtrafficking and illegal arms trade to hijacking and extortion. Furthermore, the North Caucasus is one of Russia?s poorest and least developed regions. Although the role of Islam as a destabilizing factor should not be overestimated, it is a determining characteristic regarding the region?s past and current development. The paper considers specific influencing factors like the North Caucasus? geographical location, foreign influence, its Soviet past, its history of Islamization, its societal structure, its ethnic heterogeneity and the prevalent Russian institutional vacuum with a focus on Islam and its local characteristics. Then it is questioned whether sustainable socio-economic development is possible within the prevalent institutional environment and whether Islam plays a decisive role or not. It is discovered, that weak governance on the central and regional levels and the inability to implement and enforce the rule of law are responsible for the region?s socio-economic situation. The form of societal organization plays a role, too. These factors, however, are historically determined and will therefore persist, in part even in the long run.
Monopsony and industrial development in nineteenth century Quebec : the impact of seigneurial tenure
(2016) Kufenko, Vadim; Arsenault Morin, Alex; Geloso, Vincent
We argue that the system of seigneurial tenure used in the province of Quebec until the mid-nineteenth centurya system which allowed significant market power in the establishment of plants, factories and mills, combined with restrictions on the mobility of the labor force within each seigneurial estateis best understood as a system of regionalized monopsonies in the non-farm sector. Seigneurs had incentives to reduce their employment in those sectors to reduce wage rates. We use the fact that later, with the Constitutional Act of 1791, all new settled lands had to be settled under a different system (British land laws). This natural experiment allows us to test our hypothesis that seigneurial tenure was a monopsony, using data from the 1831 and 1851 Lower Canada censuses. We find strong evidence that this difference in tenure partially explains the gap in industrial development between Quebec and the neighboring colony of Ontario.
Regional development perspectives in Vietnam: insights from a 2002 provincial social accounting matrix (SAM)
(2004) Heidhues, Franz; Breisinger, Clemens
Growing regional disparities in Vietnam have encouraged plans to extend the national Comprehensive Poverty Reduction and Growth Strategies (CPRGS) to the provincial level. The northern mountainous province of Son La has distinctive development perspectives. It was selected as the site of Vietnam?s planned biggest dam and hydroelectric power plant. Large-scale infrastructure investments are expected to contribute to economic growth and poverty reduction in the region. The impacts of these investments on the regional economy can be assessed with a multiplier model based on a regional social accounting matrix (SAM). In this paper, we present a 2002 SAM for Son La. To shed light on the socioeconomic situation, we review insights from this detailed database. A SAM-based multiplier model is then put forward to examine linkages within the provincial economy and to present first results of demand-side effects of infrastructure investment in the local construction sector.
Sen meets Schumpeter : introducing structural and dynamic elements into the human capability approach
(2012) Hartmann, Dominik
This paper argues for the necessity and potential of introducing Schumpeter?s understanding of economic development as structural change into Amartya Sen?s people-oriented development as freedom approach. Sen and other authors on social choice, human development and inequality have effectively promoted ? through the United Nations Development Programme - that the expansion of human agency, well-being and capabilities are the means and ends of development (Sen, 1999). However, this approach has lead to a neglect of structural and technological aspects of economic systems such as social network dynamics, technological progress and the structural changes in the variety and balance of economic activities. Innovation driven socioeconomic change has decisive influences on the capabilities of the actors to be active agents in the development processes. For instance, the variety of economic sectors in a country and the access to information and finance networks determine occupational choices and learning opportunities. Economic diversification and social network dynamics follow evolutionary paths that can contribute to human development, but also intrinsically drive success-breeds-success mechanisms and inequality reproduction. Therefore, an agent oriented evolutionary theory of inequality and qualitative change has to take these structural features of economic development into account.
Structural shift and increasing variety in Korea, 1960–2010 : empirical evidence of the economic development model by the creation of new sectors
(2016) Kim, Tai-Yoo; Pyka, Andreas; Yeon, Jung-In
In this paper, we examine the experiences of the Korean economy alongside theoretical knowledge of economic development and structural change. To demonstrate the generalized hypotheses on structural change, input–output tables of Korea, from 1960 to 2010, were analyzed. Our interest in taking time series of input–output tables originates from the following two issues. Firstly, we raise the question of whether Korean industrial structure changes have followed a certain pattern of structural shifts as well as increasing variety. Secondly, if so, it is questioned how the meso-level conditions for economic development could be explained from such a pattern. To search for answers, we adopt a model of the economic development by the creation of new sectors, named TEVECON, as our theoretical framework. Using this growth model, we derive hypotheses about how the structural change could affect economic development, and then we determine how the empirical analysis of the Korean economy verifies and deepens our understanding of structural change and economic development. This paper contributes to the empirical validation of the theoretical knowledge of economic development by the emergence of key sectors and the creation of new industries.
The contribution of female health to economic development
(2016) Prettner, Klaus; Kuhny, Michael; Bloom, David E.
We analyze the economic consequences for less developed countries of investing in female health. We do this through developing and calibrating a novel micro-founded dynamic general equilibrium model in which parents trade off the number of children against investments in their education and in which we allow for health-related gender differences in productivity. We show that better female health speeds up the demographic transition and thereby the take-off toward sustained economic growth. By contrast, male health improvements delay the transition and take-off because ceteris paribus they raise fertility. Investing in female health is therefore a potent lever for promoting development.
The fetters of inheritance? Equal partition and regional economic development
(2019) Wahl, Fabian; Huning, Thilo R.
How can agricultural inheritance traditions affect structural change and economic development in rural areas? The most prominent historical traditions are primogeniture, where the oldest son inherits the whole farm, and equal partition, where land is split and each heir inherits an equal share. In this paper, we provide a theoretical model that links these inheritance traditions to the local allocation of labor and capital and to municipal development. First, we show that among contemporary municipalities in West Germany, equal partition is significantly related to measures of economic development. Second, we conduct OLS and fuzzy spatial RDD estimates for Baden-Württemberg in the 1950s and today. We find that inheritance rules caused, in line with our theoretical predictions, higher incomes, population densities, and industrialization levels in areas with equal partition. Results suggest that more than a third of the overall inter-regional difference in average per capita income in present-day Baden-Württemberg, or 597 Euro, can be explained by equal partition.
The legacy of Friedrich List : the expansive reproduction system and the Korean history of industrialization
(2016) Jun, Bogang; Gerybadze, Alexander; Kim, Tai-Yoo
This study revisits the theory of Friedrich List from a more comprehensive and modernized perspective and applies it to the Korean history of industrialization. Although List is well known as the scholar who insisted on the protection of infant industry, his argument on protectionism is a part of the broader picture depicted in his book The National System of Political Economy (1841). This study follows his theoretical legacy in various fields of study. Although we can find his theoretical influence in several fields of research such as the national innovation system, concept of national competitiveness, and theory of developmental state, these studies fail to embrace all the arguments of List. Additionally, theses models focus more heavily on the explanation of historical and regional development phenomena without providing general principles of economic development behind the phenomena. This study therefore aims to suggest the expansive reproduction system as a generalized and modernized version of List’s theory and to show its example by using the Korean history of industrialization. Consequently, we argue that the economic development of Korea has been achieved by putting the theory of List into practice.
The long shadow of history : roman legacy and economic development - evidence from the German limes
(2015) Wahl, Fabian
This paper contributes to the understanding of the long-run consequences of Roman rule on economic development. In ancient times, the area of contemporary Germany was divided into a Roman and non-Roman part. The study uses this division to test whether the formerly Roman part of Germany show a higher nightlight luminosity than the non-Roman part. This is done by using the Limes wall as geographical discontinuity in a regression discontinuity design framework. The results indicate that economic development—as measured by luminosity—is indeed significantly and robustly larger in the formerly Roman parts of Germany. The study identifies the persistence of the Roman road network until the present as an important factor causing this development advantage of the formerly Roman part of Germany both by fostering city growth and by allowing for a denser road network.
Three pillars of urbanization : migration, aging, and growth
(2018) Südekum, Jens; Prettner, Klaus; Grafeneder-Weissteiner, Theresa
Economic development in industrialized countries is characterized by rising per capita GDP, increasing life expectancy, and an ever larger share of the population living in cities. We explain this pattern within a regional innovation-driven economic growth model with labor mobility and a demographic structure of overlapping generations. The model shows that there is a natural tendency for core-periphery structures to emerge in modern knowledge-based economies.
Tourism as a driver of economic development - the Colombian experience
(2008) Benković, Andreja; Meija, Juan Felipe
The current paper analyzes the importance and potentials of the tourism sector for economic development. It is divided into four major parts. After a short introduction, section two presents some theoretical insights into the topic of economic development. Commenting on the most relevant components of the catching-up theory by Abramovitz (1986) and the structural change theory by Baumol (1967) and others, it could be realized that growth and the accompanying structural changes in the distribution of employment and GDP have their sources in the sector industry. But at the moment of incorporating the demand side explanation of structural change, the service sectors offer growth potentials as well. Furthermore, the basic characteristics and importance of the tourism sector for economic development and employment are emphasized, examining the so-called ?social capabilities? and the innovation potential within the process of economic growth of any nation. A short survey of literature concerning the contribution of this sector to economic growth makes clear that tourism should be considered not just from the perspective of the benefits, but also from the costs associated with it. Section three provides an analysis of the economic impact of tourism in a developing country, namely Colombia, based on time-series analysis and data gathered supported on the ?Tourism Satellite Account? Methodology. Some relevant indicators produced by the World Economic Forum through its ?Travel and Tourism Competitiveness Report?, are also evaluated. Finally, some conclusions are drawn with respect to the potentialities, as well as the challenges identified for the Colombian case.