The Economic Impact of Social Ties: Evidence from German Reunification

We use the fall of the Berlin Wall in 1989 to show that personal relationships which individuals maintain for non-economic reasons can be an important determinant of regional economic growth. We show that West German households who have social ties to East Germany in 1989 experience a persistent rise in their personal incomes after the fall of the Berlin Wall. Moreover, the presence of these households significantly affects economic performance at the regional level: it increases the returns to entrepreneurial activity, the share of households who become entrepreneurs, and the likelihood that firms based within a given West German region invest in East Germany. As a result, West German regions which (for idiosyncratic reasons) have a high concentration of households with social ties to the East exhibit substantially higher growth in income per capita in the early 1990s. A one standard deviation rise in the share of households with social ties to East Germany in 1989 is associated with a 4.6 percentage point rise in income per capita over six years. We interpret our findings as evidence of a causal link between social ties and regional economic development.economic development, German reuni cation, networks, social ties

Clustering of initial public offerings, information revelation and underpricing

By providing an analysis of sequential going-public decisions the paper outlines conditions under which "hot issue markets" arise, i.e. under which the likelihood of a second initial public offering increases after a first firm has gone public. Two effects can trigger the rise of hot issue markets in a setting with asymmetric and costly information about both firm quality and industry prospects. The risk-averse entrepreneur can be subject to risk-induced selling pressure because of uncertain industry prospects conveyed by a first IPO in the industry. Also, investors can free-ride on the industry news, and increase their valuation for a second firm by abstaining from further costly information production. Finally, the model offers an explanation for the empirical finding that hot issue markets exhibit a higher degree of underpricing than cold issue markets

Willingness-To-Pay for Food of the Own Region: Empirical Estimates from Hypothetical and Incentive Compatible Settings

The ongoing liberalisation of the European food market provides incentives to producers to seek for innovative strategies of product differentiation. One possibility to differentiate the own product from competing ones is its region-of-origin. In this paper, we investigate consumers' willingness-to-pay and underlying preferences for food of the own region. We consider fresh milk as an example. Underlying data stem from a hypothetical contingent valuation and from an incentive compatible experimental setting with real payoffs. We find that consumers perceive fresh milk from local farmers as a trustful, high quality product, and that consumers are interested in supporting local producers. Given that price premiums are small, both methods suggest a substantial demand for local products. However, compared to contingent-valuation estimates, the inclusion of real payoffs leads to a significant decrease in the willingness-to-pay stated. This decrease can mainly be assigned to "pretending altruists": free riding subjects who respond according to social norms as long as no costs are involved.Consumer/Household Economics,

Corporate governance rules and the value of control - a study of German dual-class shares

The paper uses a dataset of German dual-class shares during 1988-1997 to study the relationship between corporate governance rules and the price differential between voting and non-voting stock. In a first step the paper discusses how mechanisms to separate control from cash-flow rights relate to the value of control. Secondly the paper studies the impact of a new takeover regulation which was adopted in Germany in 1995 and introduced the mandatory bid rule. The paper analyses how minority voting an non-voting shareholders participate in transfers of corporate control under the alternative regulatory structures pre- and post 1995. It is further shown that a mandatory bid requirement reduces the potential control value of voting stock by restricting the ration of control to cash-flow rights

Effects of hemodialysis on circulating adrenomedullin concentrations in patients with end-stage renal disease

To characterize the determinants of circulating levels of adrenomedullin (AM), the plasma levels of this peptide were measured in 58 patients with end-stage renal disease on hemodialysis, Predialysis plasma levels of AM were more than twice as high in patients on hemodialysis as compared to controls. In hemodialysis patients with heart failure (NYHA classes II-IV) or hypertensive HD patients plasma levels of AM were significantly higher than in patients with end-stage renal disease only. Plasma levels of AM were clot altered immediately by hemodialysis but decreased significantly 14-20 h after hemodialysis, AM plasma levels before hemodialysis and 14-20 h after hemodialysis were correlated with the corresponding mean arterial pressure

Verbesserung der Vermarktungsmöglichkeiten ökologischer Produkte entlang der Wertschöpfungskette - Handlungsempfehlungen auf Basis eines Vergleichs der Kosten der Verarbeitung und Vermarktung konventionell und ökologisch erzeugter Milch und Molkereiprodukte

Entgegen den ursprünglichen Erwartungen zeigt der deutsche Biomilchmarkt nach wie vor ein verhaltenes Wachstum auf. Ein wesentlicher Grund wird in den um etwa 15 % (bei Milch in Pfandflaschen) und etwa 110 % (bei z.B. Joghurt) höheren Preisen gesehen. Das Forschungsprojekt „Verbesserung der Vermarktungsmöglichkeiten ökologischer Produkte entlang der Wertschöpfungskette“ untersucht vor dem Hintergrund der Bestimmungsgründe für die Marktentwicklungen insbesondere die höheren Kosten in der Verarbeitung und Vermarktung als ein Grund für die hohen Biomilchpreise. Zielsetzung ist es, Kostensenkungspotentiale aufzudecken und Handlungsempfehlungen abzuleiten. Die technisch bedingten zusätzlichen Verarbeitungskosten bei Biomilch sind gering. Die Hauptkosten entstehen durch die geringen Verarbeitungsmengen, die damit verbundenen geringen Auslastungen der Kapazitäten sowie durch die ungünstige Verwertung der Biomilch. In der Vermarktung führen primär hohe Logistikkosten und Schwankungen in der Nachfrage zu hohen Kosten. Als Handlungsempfehlungen leiten sich Verbesserungen in der Verwertung der Biomilch, der Kapazitäten und der Logistik und Distribution ab. Das Kostensenkungspotential durch bessere Verwertung ist bei Produkten mit hohem Milcheinsatz höher als die Kostensenkungen durch Ausnutzung von Kapazitätsauslastungen. Die höheren Rohstoffkosten und Rohstofferfassungskosten sinken je kg Endprodukt je höher der Anteil der als Bioprodukt verarbeiteten und vermarkteten Biomilchmenge ist. Zur Senkung der Logistikkosten müssen sich die Unternehmen der Verarbeitung und der Vermarktung einerseits stärker spezialisieren und andererseits zunehmend kooperieren