Economic Growth of Agglomerations and Geographic Concentration of Industries – Evidence for Germany

The vast majority of regions in West Germany, and the EU, have become more similar in terms of per-capita income and productivity between 1980 and 2000. But a number of rich areas - generally large agglomerations - have succeeded in departing from this trend of convergence. They are continuing to rise above the average productivity level. We examine whether this development can also be seen as due to changes in the spatial distribution of economic sectors. Knowledge-intensive services in particular are identified as industries that combine employment growth and further geographical concentration. Logistical and nonparametric regressions confirm a positive relation between the regional weight of sectors that are continuing to concentrate geographically and the probability that this region will develop ahead of the general trend. We find that increasing localisation of fast growing industries is an important factor behind the changes in the spatial pattern of the economy.regional convergence, knowledge-intensive services, industry-specific local linkages, logistical regressions, non-parametric regressions

More People, More Jobs: Urban Renaissance in Germany

Germany's big cities are gaining in attractiveness both as a place for living and as a location for companies. Even as Germany's total population is declining, the population of cities increased by nearly 3 percent between 1999 and 2008. The same is true for spatial shifts in the economy: During the past 10 years employment in big cities increased by nearly 4 percent while stagnating in Germany as a whole. Demographic and economic trends towards cities influence each other. On the one hand young skilled people are accepting job offers in the cities. On the other hand companies are now taking the preferences of highly skilled employees into account when choosing a location because know-how is scarce. The big cities' new attractiveness is especially appealing to young people with an above-average income. Their main problem is to reconcile their career desires with their wish for a family. Cities are more able to profit from the new trend in people's choice of residence if they create better conditions for children. At the same time, good urban planning can help mitigate the social conflicts and expulsion effects that result from gentrification in the city centers.Knowledge-intensive services, Urban renaissance, Population growth

Economic Growth of Agglomerations and Geographic Concentration of Industries: Evidence for Germany

The vast majority of regions in West Germany, and the EU, have become more similar in terms of per-capita income and productivity between 1980 and 2000. But a number of rich areas - generally large agglomerations - have succeeded in departing from this trend of convergence. They are continuing to rise above the average productivity level. We examine whether this development can also be seen as due to changes in the spatial distribution of economic sectors. Knowledge-intensive services in particular are identified as industries that combine employment growth and further geographical concentration. Logistical and non-parametric regressions confirm a positive relation between the regional weight of sectors that are continuing to concentrate geographically and the probability that this region will develop ahead of the general trend. We find that increasing localisation of fast growing industries is an important factor behind the changes in the spatial pattern of the economy.

Productivity Differences in the European Union: National, Regional and Spatial Effects

Using panel data on European regions and applying Analysis of Covariance, our study provides an empirical assessment of the relative importance of national, regional and spatial factors for explaining variations of productivity. Our analysis shows that initial economic conditions or agglomeration and centrality are indeed relevant for differences in productivity levels. What is far more important, however, is which country a region belongs to. Productivity differences in the European Union are thus obviously dominated by national regimes. In light of the historically strong influence of the nation states, this result may come as no surprise. What is surprising is the fact that the role of countries has not decreased over time, despite intensive integration efforts (European Single Market, Economic and Monetary Union).Regional productivity, agglomeration and centrality, panel data econometrics

Regional productivity differences in the European Union - Theoretical predictions and empirical evidence

The analysis of regional income and productivity differences in the European Union (EU) has some tradition. The theoretical framework of most empirical studies on these subjects is the neoclassical growth model. Thus, research has focussed on convergence of income and productivity among EU regions. While spatial clustering is an issue in a number of studies, geography is rarely taken into account. This paper takes an explicitly spatial perspective, so we are able to look at an alternative theoretical approach, the New Economic Geography (NEG). Our regional classification is a modified version of the NUTS2 level. We use the degree of agglomeration and the geographical location (core vs. periphery) as geographical indicators. This allows for the empirical evaluation of some of the ideas of NEG regarding the pattern and development of regional productivity differences of EU regions. The analysis covers the period from 1982 to 2000. We develop a two-stage estimation strategy. Using panel data analysis in the first stage we estimate region-specific effects on productivity and its dynamics in terms of production and employment growth. In the second stage we apply Analysis of Covariance in order to explain those region-specific effects through other time-invariant factors and to estimate the impact of these factors on productivity. Our results indicate a strong significance of region-specific factors for productivity differences in the EU. The geographical indicators are significant but their impact appears to be rather limited. While the estimated parameters of the categorial spatial variables are consistent with predictions of the NEG, unobserved heterogenity at the national level is much more important. State-specific effects can explain a major part of variation in regional productivity. This implies that the regional pattern of productivity in the EU still is largely determined by national "productivity regimes". Regarding the productivity dynamics in the EU, we find a tendency towards convergence. This is in line with most other empirical studies on this subject. However the decrease of regional productivity differences is the result of two opposite processes: There is convergence of production but divergence of employment. Again national factors appear to dominate. We find that the dynamics of regional development in terms of output and employment growth are strongly determined by state-specific effects and these effects are varying significantly over time. A tentative interpretation of our results is that the economic development of regions within the EU can not be easily explained by either neoclassical theory or NEG. The reduction in regional productivity differences appears to be formed to a large extent by factors at the national level. Examples are the downsizing of low productivity agriculture in southern european countries or the boost in part-time employment in the Netherlands during the eighties. Further empirical research will have to establish whether the national component in regional development is attenuating and a European pattern of productivty growth is emerging.

Mehr Jobs, mehr Menschen: die Anziehungskraft der großen Städte wächst

Die großen Städte Deutschlands gewinnen sowohl als Wohnorte als auch als Unternehmensstandorte mehr und mehr an Attraktivität. Die Einwohnerzahlen sind zwischen 1999 und 2008 um fast drei Prozent gestiegen, während die Bevölkerung Deutschlands insgesamt leicht schrumpfte. Ähnlich ist die räumliche Verschiebung bei der Wirtschaft: In den vergangenen zehn Jahren nahm die Beschäftigung in den großen Städten um fast vier Prozent zu, in Deutschland insgesamt stagnierte sie. Die demographischen und ökonomischen Trends in die Städte bedingen sich gegenseitig. Schlüsselfaktor sind die gut ausgebildeten jungen Menschen, die den Jobangeboten der Unternehmen in die Städte folgen. Umgekehrt berücksichtigen aber auch immer mehr Unternehmen bei ihren Standortentscheidungen die Wohnortwünsche hoch Qualifizierter, da Know-how knapp ist. Die neue Attraktivität der Großstädte zieht gerade besser verdienende junge Bevölkerungsschichten zurück in die Stadt. Ein zentrales Problem vieler dieser Menschen ist es, berufliche Interessen und den Familienwunsch in Einklang zu bringen. Städte können deshalb den neuen Trend in der Wohnortwahl umso eher für sich nutzen, wenn sie bessere Bedingungen für eine gute Kinderbetreuung schaffen. Gleichzeitig können geeignete städtebauliche Maßnahmen soziale Konflikte entschärfen, die sich aus Verdrängungseffekten in den besonders attraktiven Innenstadtquartieren ergeben können.Knowledge-intensive services, Urban renaissance, Population growth

Economic growth of agglomerations and geographic concentration of industries: evidence for Germany

The vast majority of regions in West Germany, and the EU, have become more similar in terms of per-capita income and productivity between 1980 and 2000. But a number of rich areas - generally large agglomerations - have succeeded in departing from this trend of convergence. They are continuing to rise above the average productivity level. We examine whether this development can also be seen as due to changes in the spatial distribution of economic sectors. Knowledge-intensive services in particular are identified as industries that combine employment growth and further geographical concentration. Logistical and nonparametric regressions confirm a positive relation between the regional weight of sectors that are continuing to concentrate geographically and the probability that this region will develop ahead of the general trend. We find that increasing localisation of fast growing industries is an important factor behind the changes in the spatial pattern of the economy

Berlin: Potentiale einer neuen wirtschaftlichen Dynamik

Berlin ist in den vergangenen zehn Jahren mit seiner wirtschaftlichen Entwicklung weit hinter anderen deutschen und auch europäischen Metropolen zurückgeblieben. Allein von 1998 bis 2004 hat die Stadt 8% ihrer sozialversicherungspflichtigen Beschäftigungsverhältnisse verloren. In München und Frankfurt am Main dagegen nahm die Beschäftigung um 5% bzw. 3% zu. Mittlerweile gibt es aber in Teilen der Berliner Wirtschaft eine kräftige Dynamik. Bei überregional gehandelten Dienstleistungen, die für die Wirtschaft von Großstädten von besonderer Bedeutung sind, hat sich die Hauptstadt zu einem wichtigen Standort entwickelt. Dies gilt nicht nur für den Mediensektor, sondern auch für unternehmensbezogene Dienste wie Forschung, Softwareentwicklung und Werbung. Auch Dienstleistungen im Zusammenhang mit dem Tourismus expandieren stark. Dabei hat sich der Rückstand Berlins bei der Beschäftigungsentwicklung gegenüber anderen deutschen Dienstleistungsmetropolen von 3,2 Prozentpunkten 1998 auf nur noch 0,2 Prozentpunkte im vergangenen Jahr verringert - allerdings bei allgemein deutlichem Rückgang der sozialversicherungspflichtigen Beschäftigung in Deutschland

More People, More Jobs: Urban Renaissance in Germany

Germany's big cities are gaining in attractiveness both as a place for living and as a location for companies. Even as Germany's total population is declining, the population of cities increased by nearly 3 percent between 1999 and 2008. The same is true for spatial shifts in the economy: During the past 10 years employment in big cities increased by nearly 4 percent while stagnating in Germany as a whole. Demographic and economic trends towards cities influence each other. On the one hand young skilled people are accepting job offers in the cities. On the other hand companies are now taking the preferences of highly skilled employees into account when choosing a location because know-how is scarce. The big cities' new attractiveness is especially appealing to young people with an above-average income. Their main problem is to reconcile their career desires with their wish for a family. Cities are more able to profit from the new trend in people's choice of residence if they create better conditions for children. At the same time, good urban planning can help mitigate the social conflicts and expulsion effects that result from gentrification in the city centers