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This paper analyses the relationship between the German Kiel Institute of World Economics and the Rockefeller Foundation in the years 1925-1950. It focuses on the role of politics in the promotion of science and shows the great difficulties the foundation had in developing a strategy to react to the Nazi’s seizure of power in 1933. The Kiel Institute disguised itself as an unpolitical and “objective” institute and managed to regain support after 1934. During the Second World War, the Rockefeller Foundation abandoned the idea of science as an area detached from politics by definition. In the late 1940s, it carefully reassessed the German academic landscape and, in the case of the Kiel Institute, came to the conclusion not to resume a significant amount of support. [ABSTRACT FROM AUTHOR]

Stylized facts suggest that output volatility in OECD countries has declined in recent years. The causes and the nature of this decline have so far been analyzed mainly for the United States. In this paper, we analyze whether structural changes in output volatility in Germany can be detected. We report evidence that output volatility has declined in Germany. It is difficult to answer the question whether this decline in output volatility reflects good economic and monetary policy or merely‘good luck’. [ABSTRACT FROM AUTHOR]

As an important fuel, hard coal shaped industrialisation. Due to its specific materiality, coal established different options for intertwining industry and resource. This paper concentrates on the one hand on the specific properties of coal and, on the other, on the economic and technological operations with coal. Using the example of the different material properties of coal from the coal districts of Inde and Wurm, these interrelations are examined and illustrate how a space of resource extraction could be arranged. [ABSTRACT FROM AUTHOR]

This article argues that German industrial relations are undergoing a process of fundamental liberalization, albeit incremental and protracted over time, referencing the paper "Softening industrial relations institutions, hardening growth model: The transformation of the German political economy" published in the December 2014 issue of the journal "Stato e Mercato." Topics of the paper authored by Lucio Baccaro and Chiara Benassi include the German economic growth model.

There is an intensive debate about old-age poverty in Germany that has induced political parties to develop proposals for higher pensions of poor pensioners in light of the federal elections of September 2013. In addition, several proposals from economists aim at reforming the pension system in a way that mitigates old-age poverty. In this paper, we consider these proposals in a computable general equilibrium model in order to derive their effects on the income distribution, on employment, on the capital stock and on GDP. Our results indicate that negative employment, capital and GDP effects are induced by such reforms as compared to the alternative of basic means-tested social welfare in old-age. Moreover, the strongest beneficiaries would be the currently higher age employees with low income and much less the respective younger employees, while younger and higher age employees with high and medium incomes will lose. [ABSTRACT FROM AUTHOR]

A central prediction of a large class of theoretical models is that industry location is not uniquely determined by fundamentals. Despite the theoretical prominence of this idea, there is little systematic evidence in support of its empirical relevance. This paper exploits the division of Germany after World War II and the reunification of East and West Germany as an exogenous shock to industry location. Focusing on a particular economic activity, an air hub, we develop a body of evidence that the relocation of Germany's air hub from Berlin to Frankfurt in response to division is a shift between multiple steady states. [ABSTRACT FROM AUTHOR]

Beginning with the current global and European imbalances and crises and consideration of the German reaction to them, the paper explores the political economy origins of the conservative German policy stance. It emerges that an export-oriented economy was a deliberate decision of the German elite after World War II and that the external constraint may be regarded as appropriately designed for internal discipline and efficiency in a self-reinforcing process. [ABSTRACT FROM AUTHOR]

What happens when governments that have benefited from 'solidarity' programs to redistribute money from richer to poorer states are faced with the prospect of being redefined as a 'richer state' themselves? After communism, such a situation has confronted the traditionally poorer states of Western Germany and the traditionally poorer nations of the European Union. Yet funding was far more generous in the East German case than in the Central and Eastern European case. Why? The strong institutional positions of the traditionally poorer states meant, in both cases, that the key factors shaping the outcomes were the electoral exposure of the respective central governments and the presence or absence of hard budget constraints on that political centre. High exposure and low constraint marked the German case while low exposure and high constraint characterized the EU case. [ABSTRACT FROM AUTHOR]

This article presents an analysis of whether the decision of officials at German companies to invest abroad is unpatriotic. Many companies are considering shifting parts of their production abroad, and some have already done so. This is an economic policy issue that is being hotly debated. Politicians have called the action unpatriotic and some have called the companies traitors. Generally, it is argued that shifting production in this way entails shifting jobs abroad that are then lost to the German economy. This is not only a one-sided argument, but also erroneous, because it overlooks the positive aspects of corporate expansion abroad and the international division of labor it entails, as well as the question of competition, which are all of great significance. Investment by German companies abroad can allegedly be an important way to maintain and increase competitiveness, and it can also have strong positive effects on the German economy. The foreign capital stock of German firms has risen, especially since 1995. In 2000 that was a volume totaling 570 billion euros. By comparison the capital stock of British firms abroad in the same year was 62.3% of gross domestic product.

In this article we use the unification of Germany in 1990 to test the hypothesis that an increase in the supply of a production factor generates skill biased technical change. We test for this mechanism in the context of the model presented by Acemoglu and Autor (2011, Skills, tasks and technologies: implications for employment and earnings', in O. Ashenfelter and D. Card (eds), Handbook of Labor Economics, Vol. 4B. Amsterdam: North Holland) that allows endogenous assignment of skills to tasks in the economy. We use cohorts of workers from comparable countries as a control group. After discussing the possible confounding factors, we conclude that this effect is absent. The differential pattern among the countries seems to be determined by labor market flexibilization and tax reform. [ABSTRACT FROM AUTHOR]

The following article studies Martin Luther's contribution to modern economic thought as well as – by the same token – the monetary origins of the German Reformation. Contrary to conventional wisdom, Luther made a valuable contribution to economic theory, particularly with regard to the monetary situation of his age, mainly silver scarcity and related problems. Luther and other theologians and pamphleteers during the early Reformation never ceased to stress the problems that related to the scarcity of silver and the practice of hoarding of money – a concern found in older discourses as well as later economic theory of the modern age, up to twentieth-century ‘Keynesian' economics. The first section discusses those cornerstones of Luther's biography that are relevant in the present context (I.). The second section briefly discusses how modern economics has evolved into a very peculiar science and how Luther may be placed within it, if one shifts the focus from a somewhat skewed genealogy of modern theory (which has had little place for economic thinkers prior to Adam Smith) to a view that acknowledges that the formation of the modern or ‘mainstream' – neoclassical economics – was due to a very peculiar change in epistemology. This change only occurred long after 1800, but had precursors that date back as far as Luther and the medieval Scholastic theologians (II.). This section is followed by a discussion of Luther's basic „economics“ (III.), after which two particular components of Luther's economic „theory“ will be studied in the light of new research: the focus on greed (avaritia) as the desire not to give away, compared to a more traditional interpretation of this deadly sin as chrematistics (i. e. the desire to have more than one's due or fair share) (IV.).These findings will then be applied to a very peculiar element of Luther's theology: the indulgence critique that stood at the heart of his Reformation in 1517 (V.). In this way it will be shown that Martin Luther's Reformation had monetary origins, and that by his new interpretation of scripture, from which some essentially economic stances were derived, Luther also made a valuable contribution to modern economics (VI.). [ABSTRACT FROM AUTHOR]

This article examines the channels through which offshoring affects employment in a representative sample of German establishments, using a difference-in-differences matching approach. Offshoring is measured by an increase in the share of foreign to total intermediate inputs at the plant-level. We identify a positive productivity effect and isolate a negative downsizing effect from offshoring on employment, by exploiting differences between offshoring plants that do and do not simultaneously restructure. Furthermore, we cannot find evidence of negative indirect employment effects on domestic suppliers or competitors. ( JEL F16, J23, F23, C21) [ABSTRACT FROM AUTHOR]

In the following, we present the earliest input-output table for Germany: It covers 40 economic branches, five final demand categories and five primary inputs. The symmetric table for 1936 is completely based on original statistical data and does not rely on separate supply and use tables. The core of our endeavour is based on the German industrial census of 1936. Originally, this census and its forerunner of 1933 had especially been designed by the German Statistical Office (StRA) to compile an input-output-table for Germany as a basis for managing the business cycle. In connection with rearmament, however, this endeavour was given up and instead, these data were used for constructing detailed material balance sheets, which served as a statistical basis for preparing the war. Based on these hitherto secret records and additional statistical information, we fulfilled the original plan of the StRA of constructing the desired input-output table. Government is treated as an intermediate sector and placed into quadrant I of the table. In quadrant II it appears with only one figure (government gross production minus fees for specific government services). Government is delimitated into three sub-sectors: public administration and other government services, military spending and social security. In addition, public investment for civilian purposes is assigned to gross fixed capital formation in quadrant II. Military expenditure, however, is treated as government consumption and not as investment. The input-output table offers a new benchmark for gross domestic product (GDP) and thus production, income and expenditure of Germany in 1936. We found a comparably high level of GDP and a significantly higher mixed income/operating surplus which hints at exceptionally high incomes and hidden profits of the armament industry. Due to our unique production approach of calculating GDP these hidden profits were revealed. [ABSTRACT FROM AUTHOR]

We analyze farmland prices in the German federal state of Brandenburg from 2000 to 2011 with the aim to understand the price formation process in farmland foreclosures. Pressured sales usually result in a price discount due to time constraints; however, the land is sold using public auctions. This may lead to a price premium. Since the effect of a foreclosure on farmland prices is ambiguous, we empirically quantify the overall effect. We use matching techniques and a regression-based approach. We find that on average, price premiums are realized, though the effect depends on prevailing land market conditions. [ABSTRACT FROM AUTHOR]

The article discusses the changing perceptions on the economic performance of Germany. Topics covered include the rapid shift in public discourse concerning the successful economic performance of the country. Also mentioned is the focus of the country's government on public service, localism and political efficiency.

Large universal banks played a major role in Germany's industrialization because they provided loans to industry and thereby helped firms to overcome liquidity constraints. Previous research has also argued that they were equally important for the German stock market. This article provides quantitative and qualitative evidence that although the market for underwriters was dominated by a small oligopoly of six large banks, there was still perceptible competition, which kept fees and short-run profits low. Another interesting finding presented here is the absence of a signalling effect to investors. Neither underpricing nor the one-year performance was different for the IPOs issued by one of the Big Six. Thus, although the German IPO business was in the hands of a small oligopoly, investors did not benefit from the lack of competition. One explanation is that the quality of IPOs on the German stock market of the time was very good in general as a result of the competition between underwriters, but also as a result of the tight regulation of underwriting, which ensured the quality of all firms on the German stock market. [ABSTRACT FROM AUTHOR]

In view of debates among critical urban scholars regarding the relationship between the current economic crisis and the stability of neoliberal hegemony on the urban scale, this article analyzes (1) the impact of the economic recession on the city of Frankfurt am Main, and (2) whether urban politics in the German financial center will witness a new phase of post-neoliberalization. Statistical analyses of the local labor and property markets and of municipal budget trends reveal that the implications of the current crisis are relatively limited, especially when compared to the dot.com crisis in the early 2000s. Furthermore, a discourse analysis of the debates in the Frankfurt City Council between 2008 and 2010, supplemented by interviews with local political elites, shows that neoliberal hegemony remains stable and powerful regardless of the deep economic decline and a short period of uncertainty and intensive hegemonic struggles. In my analysis I focus on the power of neoliberal subjectivity and knowledge production in order to try and explain the deepening of the general consensus among local elites by demonstrating that a broad majority of actors from different political parties interprets the crisis within a neoliberal rationality. [ABSTRACT FROM AUTHOR]

The interplay between religion and the economy has long occupied social scientists. We construct a unique panel of income and Protestant church attendance using 175 Prussian counties, presented in six waves from 1886 to 1911. The data reveal a marked decline in church attendance coinciding with increasing income. The cross-section also shows a negative association between income and church attendance. The associations disappear in panel analyses, including first-differenced models of the 1886 to 1911 change, panel models with county and time fixed effects, and panel Granger-causality tests. The results cast doubt on causal interpretations of the religion-economy nexus in Prussian secularization. [ABSTRACT FROM AUTHOR]

We investigate to what extent convergence in production levels per worker has been achieved in Germany since unification. To this end, we model the distribution of GDP per employee across German districts using two-component normal mixtures. While in the first year after unification, the two-component distributions were clearly separated and bimodal, corresponding to the East and West German districts, respectively, in the following years they started to merge showing only one mode. Still, using the recently developed EM-test for homogeneity in normal mixtures, the hypothesis of just a single normal component for the whole distribution is clearly rejected for all years. A Posterior analysis shows that about a third of the East German districts were assigned to the richer component in 2006, thus catching up to levels of the West. The growth rate of a mover district is about 1% point higher than the growth rate of a non-mover district which had the same initial level of GDP per employee. [ABSTRACT FROM AUTHOR]

The article focuses on the attempts to reinforce capitalism within Germany during the Nuremberg War Crimes Trials between 1945 and 1949. The author explains that the United Nations Organization was attempting to secure peace through stabilizing economic conditions and had set up an Economics and Social Committee. She discusses the relationship between National Socialism and capitalism, explores how the Nuremberg Trials addressed both political and corporate ideals, and examines the connection between Germany's Third Reich war crimes and its economics.

We provide estimates of the risk-sharing and redistributive properties of the German federal fiscal system based on data from 1970 to 2006, with special attention to the effects of German unification. Tax revenue sharing between the states and the federal government and the fiscal equalization mechanism (Länderfinanzausgleich) together reduce differences in per-capita state incomes by almost 40 percent. The federal fiscal system offsets 47 percent of an asymmetric shock to state per-capita incomes. This effect has significantly decreased after the inclusion of the East German states in 1995. Furthermore, we find that the German fiscal system provides almost perfect insurance for state government budgets against asymmetric revenue shocks; also, its redistributive effect with regard to the tax resources available to state governments is very strong. [ABSTRACT FROM PUBLISHER]

The French Revolution had a momentous impact on neighboring countries. It removed the legal and economic barriers protecting oligarchies, established the principle of equality before the law, and prepared economies for the new industrial opportunities of the second half of the 19th century. We present within-Germany evidence on the long-run implications of these institutional reforms. Occupied areas appear to have experienced more rapid urbanization growth, especially after 1850. A two-stage least squares strategy provides evidence consistent with the hypothesis that the reforms instigated by the French had a positive impact on growth. JEL: N13, N43, O47 [ABSTRACT FROM AUTHOR]

The article discusses the concept of social capital and its genesis and effects. The article analyzes components of both structural and cultural nature, and investigates social capital in Germany. Findings show that aside from personal factors, cultural, economic, and social aspects are to be considered. Further the impact of such aspects on the economy and overall quality of life are examined.

Many researchers take as axiomatic the proposition that economic action in clusters is embedded in dense, durable and trust-based social networks. It is suggested here that the bias towards high-trust, enduring relations obscures the competitive dynamics of networks, even where co-operation can be identified. Drawing attention to the competitive motives underlying the construction of social networks, an investigation is made into the duration and brokering of dyadic relations in business owners’ advice networks. The analysis of 668 dyadic ties in a population of 113 small business owners in two textile and clothing clusters in Germany reveals considerable variation in the duration of social relations and the likelihood that they were formed through third-party brokers, many of whom were direct competitors creating more ephemeral links. The findings suggest that ‘marketless’ conceptions of social networks in clusters need to be balanced with a stronger concern for the role of competition in the social embeddedness of small firms. [ABSTRACT FROM PUBLISHER]

With the aim of identifying emerging patterns of spatial development and the driving forces behind the associated process, in this article we draw together two threads of interlinked phenomena. First, we look at how multi-location firms from the knowledge economy develop their intra-firm networks internationally. Second, we establish the partners with which these firms have working relationships along individual chains of value, and in which these extra-firm linkages are located. We start from a conceptual background that combines the location behaviour of firms with a value chain approach. We analyse the two main pillars of the knowledge economy – advanced producer services (APS) and high-tech firms. A case study carried out in the greater Munich area provides the empirical basis and draws on quantitative and qualitative research methods. The results provide evidence that the greater Munich area can be regarded simultaneously as a hierarchically organized polycentric mega-city region and high-grade localized system of value chains. [ABSTRACT FROM AUTHOR]

Since unification, the debate about Germany's poor economic performance has focused on supply-side weaknesses, and the associated reform agenda sought to make low-skill labour markets more flexible. We question this diagnosis using three lines of argument. First, effective restnicturing of the supply side in the core advanced industries was carried out by tie private sector using institutions of the coordinated economy, including unions, works councils and block-holder owners. Second, the implementation of orthodox labour market and welfare state reforms created a flexible labour market at the lower end. Third, low growth and high unemployment are largely accounted for by the persistent weakness of domestic aggregate demand, rather than by the failure to reform the supply side. Strong growth in recent years reflects the successful restructuring of the core economy. To explain these developments, we identify the external pressures on companies in the context of increased global competition, the continuing value of the institutions of the coordinated market economy to the private sector and the constraints imposed on the use of stabilizing macroeconomic policy by these institutions. We also suggest how changes in political coalitions allowed orthodox labour market reforms to be implemented in a consensus political system. [ABSTRACT FROM AUTHOR]

The article focuses on the positive rediscovery of German economist Gustav Schmoller's economic theories. Earlier in Germany, Schmoller was labeled a socialist of the chair. His posthumous works have not been analyzed, and no critical edition of his major works exists until recently. One of the reasons cited for the renaissance is a general dissatisfaction with mainstream formal theorizing. From this perspective, the renaissance has been spurred by an unmet scholarly demand for practical applications of economics. The activity could also be attributed to the following: increasing interest in old institutional and evolutionary economics in Europe; a rising interest in the history of economic ideas, in methodology, and in ethics; and the emergence of new insights about Schmoller that allow analysts to see that he, in fact, embraced a different type of theory.

The persistence of high unemployment has been one of the most important economic problems in Germany for many years. The rise in the unemployment rate was associated with a substantial increase in the share of long-term unemployed people, that is those who have already been unemployed for at least one year. The average monthly hazard rate from unemployment, that is the unemployment outflow in a given month relative to the stock of unemployed people at the end of the previous month, declined from about 30 percent at the beginning of the early eighties to about 15 percent in the mid-eighties, increased somewhat during the strong economic upswing in the mid-eighties and declined again strongly after the recession at the beginning of the nineties. According to the Organization for Economic Cooperation and Development almost every second unemployed person has been unemployed for more than a year in Germany, which is about the average in the European Union. One popular hypothesis for the observed decline in the hazard rate is that an individual's employment prospects deteriorate with the duration of the unemployment spell, which is termed negative duration dependence in the literature. An individual's human capital may deteriorate during unemployment and this effect may be the stronger the longer unemployment lasts.

This article focuses on recent trends in the literature of German economics. No shortcut is open to the reviewer of economic literature written in German. Though most of the writing naturally comes from Germany, accuracy would require the constant use of such clumsy phrases as "economic theory in Germany, Austria, and Switzerland" or "economic theory in the German-speaking countries." To simplify matters the word German frequently needs to stand for developments in all three countries. It would be much easier for the reviewer of current economic thinking in Germany, Austria, and Switzerland to arrange his material if there were any clear-cut "schools" that originated in these countries in the postwar period. At the turn of the century the "Austrian school," the German "historical school," the "Kathedersozialisten," the intense Marxist controversy, outside the universities, would have provided obvious starting points for a panorama of German economic theory. Today there are no such definite German "schools," neoliberalism perhaps being the only exception. But neoliberalism has little to offer in the field of economic theory that is new. The main stress of the neoliberal writings lies on programmatic aspects.

The article attempts to determine the solutions for the economic problem in Germany. It discusses the six possible solutions for the problem, of which only three solutions are seem to be realistic. One is the plan agreed upon by the Big Three in August 1945 at Potsdam. Second is against the Potsdam plan because of its alleged incompatibility with fairly interpreted German and European economic needs. Finally, to treat Germany it would consist in the perpetuation of its disruption.