The Interaction between Culture and Economy in Vietnam

Historically, the Vietnamese state developed in an area along the Red River and within its delta. The need to protect the inhabitants of this land from dangerous floods gave rise to a “hydraulic societyâ€, which was accompanied by a specific culture. One of the features of this culture is an emphasis on formal education, which was “inherited†from a past in which the passing of an examination was a precondition for acquiring a high position in the state. Today, the Vietnamese culture is a supporting factor in the current development process in Vietnam. Rigorous reform steps carried out since 1986 have transformed the Vietnamese socialist economy, which mainly followed the Soviet blueprint, into a market driven economy which is governed by strong private incentives. The culture predominant in this country on the one hand supports the functioning of the new capitalist system, and on the other hand compensates for many of its weaknesses. As a consequence a development process has been generated which has led to high rates of economic growth. However, it is not without systemic risks.

Formula allocation: The regional allocation of budgetary funds for measures of active labour market policy in Germany

In Germany, the funds for active labour market policy – e.g. training measures and job creation schemes – are paid from a common budget, the so-called integration title. For the allocation of budgetary funds (amounting to € 13 billion every year) to the regions of the Federal Republic of Germany, a formula was developed which was to be based essentially on a labour market indicator. A proposal for the method of distribution (including the indicator) was developed at the IAB. The criteria for the development were: most accurate fit to the legal guidelines of the Social Code, transparency of the procedure, openness for necessary policy decisions, scientific correctness in implementation, efficiency of the whole process. Here the procedure used in constructing the indicator is explained and the distribution result is set out. This was finally passed by the Executive Board and the Board of Governors of the Federal Employment Service and contains the necessary business policy weightings. The history of the implementation of the instrument for the distribution of resources is also dealt with briefly.

Formula allocation : the regional allocation of budgetary funds for measures of active labour market policy in Germany

"A common problem of regional policy is the distribution of funds to regional units. To follow the specific purpose of this budgeting process in a rational way this is often done in a formula allocation on the basis of official statistics. In the paper this is shown with the example of funds for active labour market policy. In Germany, measures of active labour market policy - e.g. training measures, integration subsidies and job creation schemes - are paid from a common budget. For the allocation of these budgetary funds (amounting to EURO 0,194 billion in 2004) to the regions of the Federal Republic of Germany, a formula was developed which was to be based essentially on a labour market indicator. The criteria for the development of a formula allocation were: most accurate fit to the legal guidelines of the Social Code, transparency of the procedure, openness for necessary policy decisions, scientific correctness in implementation, efficiency of the whole process. Here the procedure used in constructing the distribution process is explained and the distribution result is set out. Both were finally passed by the Supervisory Board of the Federal Employment Agency in Germany." (Author's abstract, IAB-Doku) ((en))Arbeitsmarktpolitik - Finanzierung, regionale Verteilung, Budget, Indikatorenbildung

Effects of cultural diversity on individual establishments

International immigration affects the degree of cultural diversity present in a labour force. This paper focuses on the consequences of immigration with respect to the level of cultural diversity by estimating employment functions for individual establishments. The theory behind the empirical analyses is based on a 'turned around' New Economic Geography model. The data basis used is a linked employer -- employee data set generated by a fusion of the IAB Establishment Panel with the Employment Statistics of Germany, which provides very detailed information about individual workers and establishments. In the empirical analyses it is shown that employment is lower when the degree of diversity is higher, regarding the revenue of an individual establishment as given. From this result it can be derived under the conditions of monopolistic competition (implying elastic product demand) that the establishment is able to occupy a relatively large part of the market. Finally this implies relatively high labour demand.

Formula allocation: The regional allocation of budgetary funds for measures of active labour market policy in Germany

A common problem of regional policy is the distribution of funds to regional units. To follow the specific purpose of this budgeting process in a rational way this is often done in a formula allocation on the basis of official statistics. In Germany, measures of active labour market policy – e.g. training measures, integration subsidies and job creation schemes – are paid from a common budget. For the allocation of these budgetary funds to the regions of the Federal Republic of Germany, a formula was developed which was to be based essentially on a labour market indicator. Here the procedure used in constructing the distribution process is explained and the distribution result for the year 2004 is set out.

Effects of cultural diversity on individual establishments

International immigration affects the degree of cultural diversity present in a labour force. This paper focuses on the consequences of immigration with respect to the level of cultural diversity by estimating employment functions for individual establishments. The theory behind the empirical analyses is based on a "turned around" New Economic Geography model. The data basis used is a linked employer - employee data set generated by a fusion of the IAB Establishment Panel with the Employment Statistics of Germany, which provides very detailed information about individual workers and establishments. In the empirical analyses it is shown that employment is lower when the degree of diversity is higher, regarding the revenue of an individual establishment as given. From this result it can be derived under the conditions of monopolistic competition (implying elastic product demand) that the establishment is able to occupy a relatively large part of the market. Finally this implies relatively high labour demand.effects of immigration, cultural diversity, employment, productivity, firm level

The Estimation of Flows on Regional Labour Markets By Using the ADETON Procedure

An in-depth analysis of regional labour markets requires information not only on stocks but also on flows. As a tool for detailed flow analysis the Multi Account System (MAS) has been developed at the Institute for Employment Research (IAB) which uses fine grained transition matrices as basic information. To estimate these transition matrices from possibly incomplete and inconsistent statistical data the ADETON procedure has been worked out to compute matrices which are struc-turally similar to given reference matrix and at the same time satisfy certain linear con-straints. As main advantage of ADETON in comparison to conventional methods soft constraints may be specified which allow information of inherently fuzzy character about transition flows to be taken into account. By using soft constraints of this kind it is possible to in-clude data affected by sampling errors or are distorted by some kind of “noiseâ€. To obtain structural similarity to a reference matrix two different distance measures can be used: relative entropy and the chi-square distance function. They have been proven to give approximately identical results. Up to now ADETON has shown to be an efficient computation method even for complex problems with thousands of matrix elements and constraints. ADETON has been applied to estimate matrices of the Multi Account System. The results are used for the guidance of regional labour market policy.

Local economic structure and industry development in Germany, 1993-2001

"This paper analyses the impact of dynamic MAR- and Jacobs-externalities on local employment growth in Germany between 1993 and 2001. In order to facilitate a comparison between the neighbouring countries we firstly replicate the study of Combes (2000) on local employment growth in France and find very similar results for Germany. Afterwards we formulate an alternative empirical model that is based on a weighted regression approach. With this model we find that Jacobs-externalities matter in manufacturing, whereas MAR-externalities are present in advanced service sectors." (Author's abstract, IAB-Doku) ((en))Wirtschaftswachstum - Auswirkungen, Beschäftigungsentwicklung, regionale Disparität, Regionalentwicklung, regionale Faktoren

Structural change and regional employment dynamics

"A casual look at regional unemployment rates reveals that there are vast differences which cannot be explained by different institutional settings. Our paper attempts to trace these differences in the regions' labour market performance back to the regions' specialisation in products that are more or less advanced in their product cycle. The model we develop shows how individual profit and utility maximisation endogenously leads to decreasing employment in the presence of process innovation. Things deteriorate even further if the region under observation is less innovative than others. Our model suggests that the only way to escape from this vicious circle is to specialize in products that are at the beginning of their economic life." (Author's abstract, IAB-Doku) ((en))Arbeitslosenquote, regionale Disparität, regionaler Arbeitsmarkt, Produktinnovation, Wirtschaftsstrukturwandel, Beschäftigungsentwicklung

Regional and occupational disparities in the wages of young blue- and white-collar workers

According to human capital theory the wages of people, who invest a comparable amount of time and money into an education should be also comparable. Therefore, the wages of work-ers who passed a three-year occupational education in the German so-called “dual system” represent a test of the theory. The “dual system” is a specific form of education in which ap-prentices are trained in an employing firm and in school. Descriptive analyses show that average wages between different occupations only one year after finishing the education differ by about 100 percent. In the past multivariate analyses were not available. In the paper a cross-classified multilevel model with fixed effects is used to identify specific effects of occupations and regions and to control for the heterogeneity of individual workers. The data base is the IAB Employment Sample which is a one percent sample of total employment. On the basis of this data the necessary differentiation for about 100 occupations and 327 regions is possible. In Germany occupational structures in the labour market are more important than in other countries. In the paper a comparison to the structure of regional disparities is given. Several theoretical hypotheses are tested to explain the differences.