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Twenty Years of Economic Reconstruction in East Germany

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Wey, C., Zimmermann, K. (Eds.) (2009). Twenty Years of Economic Reconstruction in East Germany. Duncker & Humblot. https://doi.org/10.3790/978-3-428-53257-5
Wey, Christian and Zimmermann, Klaus F.. Twenty Years of Economic Reconstruction in East Germany. Duncker & Humblot, 2009. Book. https://doi.org/10.3790/978-3-428-53257-5
Wey, C, Zimmermann, K (eds.) (2009): Twenty Years of Economic Reconstruction in East Germany, Duncker & Humblot, [online] https://doi.org/10.3790/978-3-428-53257-5

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Twenty Years of Economic Reconstruction in East Germany

Editors: Wey, Christian | Zimmermann, Klaus F.

Applied Economics Quarterly. Supplements, Vol. 60

(2009)

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Abstract

This year marks the 20th anniversary of German reunification. The events of autumn 1989 revealed that the GDR was not just politically but also economically bankrupt. Given the large-scale emigration to the West after the fall of the Wall, the D-Mark was introduced quickly, despite widespread rejection of this measure by the leading economist of the time. Rapid wage increases intensified the pressure on businesses, and the adjustment shock made it necessary to rebuild the foundations of the economy at a rapid pace and an extremely high cost. With the creation of the economic and currency union, a dynamic process of growth and development was launched in many areas of society.

Twenty years later, the questions arise: Where do we stand today, what implications can be derived for the future, and what remains to be done in the policy realm? This AEQ Supplement addresses the following issues:

- Structural convergence and regional development: Should policy makers really attempt to counteract convergence? How far is East Germany currently lagging behind? What strategic decisions do policy makers need to make?

- Old-age poverty: Is there an increasing risk of old-age poverty in East Germany? What are the results of societal aging in East Germany?

- Returns to education for full-time employees: The East has caught up

- Dramatic demographic changes in Thuringia: Will Thuringia face a shortage of skilled labor up to 2015?

Table of Contents

Section Title Page Action Price
Editorial 5
Contents 7
Markus Demary / Klaus-Heiner Röhl: Twenty Years after the Fall of the Berlin Wall: Structural Convergence in a Slow-Growth Environment 9
Abstract 9
1. Introduction 9
2. The Convergence towards West Germany Has Failed So Far – Or Has it Really? 10
2.1 The State of Convergence 10
2.2 Adjustment Towards the West German Economic Structure 13
2.3 Regional Development in Manufacturing 14
2.4 Shortcomings in High-Tech Industries 16
2.5 The Role of New Industrial Clusters 16
3. Regional Investment Incentives in East Germany – Does the Joint Task Work? 18
3.1 A Panel Data Regression Model for East German Regions 19
3.2 Empirical Results for Regions 22
3.3 Industry-Specific Empirical Results 25
4. Conclusions 26
References 27
Klaus-Werner Schatz: Twenty Years after the Fall of the Berlin Wall: Structural Convergence in a Slow-Growth Environment. Comment 29
1. Macroeconomic East-West Convergence 29
2. East Germany: Catching up by the Migration of its Population? 29
3. Structural Convergence 30
4. Implications 32
References 33
Stefan Krenz / Wolfgang Nagl / Joachim Ragnitz: Is There a Growing Risk of Old-Age Poverty in East Germany? 35
Abstract 35
1. Introduction 35
2. The German Pension System 36
3. Demographic Setup in East Germany 38
4. Data and Methodology 39
5. Single-Person Households 41
6. Two-Person Households 45
7. Widows 48
8. Conclusion 49
References 50
Jürgen Schupp: Is There a Growing Risk of Old-Age Poverty in East Germany? Comment 51
Herbert S. Buscher et al.: Will There Be a Shortage of Skilled Labor? An East German Perspective to 2015 55
Abstract 55
1. Introduction 55
2. Forecast of Labor Demand and Supply in Thuringia 57
3. The Perspective of Firms 65
4. Policy Recommendations and Conclusions 70
References 75
Hilmar Schneider: Will There Be a Shortage of Skilled Labor? An East German Perspective to 2015. Comment 77
General Remarks 77
Remarks in Particular 78
Conclusion 81
References 81
Katie Lupo / Silke Anger: Returns to Human Capital in Germany Post-Unification 83
Abstract 83
1. Introduction 83
2. Literature Review 84
3. Data 85
4. Empirical Strategy 87
5. Results 88
5.1 Initial Transition Years 88
5.2 Returns to Experience 90
5.3 Returns to Education 94
5.4 Migrants 96
5.5 Returns to School Leaving Degrees 98
6. Conclusion 102
References 103
Wolfgang Scheremet: Returns to Human Capital in Germany Post-Unification. Comment 105
Data 106
Results 107
Participants 111