Agglomeration, Growth, And Adjustment: A Theoretical And Empirical Study Of Regional Labor Markets In Germany (zew Economic Studies)

By means of theoretical and empirical analysis agglomeration economies as localized returns to scale are established as the basic source of economic disparity. The central implication for the labor market is the resulting path dependency of the spatial employment pattern. As an empirical investigation of migration within Germany documents strong regional segmentation in the short run, local wage formation is of particular importance for the adjustment process in response to changes of the spatial employment pattern. However, a theoretical discussion shows that in the German setting with centralized wage bargaining local wages tends to be inflexible. This view is supported by an empirical investigation of the spatial wage structure in Germany using district data. As the Kyoto conference of the parties on the United Nations Framework Convention on Climate Change once again underscored, man-made climate change has become one of the major challenges to our generation and many generations to come. Since scientific evidence on climate change can be seen as increasingly reliable, the focus of our attention has to turn more and more to the question of foreseeable damages and to possibilities to prevent and mitigate climate change. In other words, we need to analyse the economic aspects of man­ marle climate change and the policy options to prevent its most severe impacts. This book reports on the findings of an international workshop on these aspects of global climate change. It was organised by the Centre for European Economic Research (ZEW) in Mannheim, Germany on March 6th and 7th 1997. In the light of the ongoing international policy-making process on climate change, we decided to publish the report after the Kyoto conference from December Ist to 10th, 1997, to include the results of the conference, which emphasise the importance of economic aspects and economic policy options when it comes to addressing the problern of man-made climate change. Thus, this book went to press in February 1998 the moment we received the official version of the Kyoto Protocol, which is reproduced in the annex.

It is dealt with disparities in employment growth, unemployment, and wages between regional labor markets in Germany. First, endogenous formation and growth of industry locations due to agglomeration economies is established as a basic source of disparity in employment. Then, spatial frictions and local wage inflexibility due to central wage bargaining are detected as causes of unemployment disparities. Throughout the book theoretical analysis is combined with rigorous empirical testing using a large set of regional data at district level. In order to gain and robustify empirical results, recent methods in panel econometrics and spatial data analysis are employed. An overview on the extent of key regional labor market disparities in Germany is given. The book enables to assess our current understanding of the role of locational issues in causing those disparities, and thus to understand the basic justification of regional policy.

The successful signing of the Kyoto Protocol showed that there is international consensus about the problem of man-made climate change and that substantial greenhouse gas emission targets will soon be established. Based on the current scientific knowledge about climate change this workshop report analyses the most important economic aspects of man-made climate change and the way effective and efficient policies can be designed to achieve the necessary reductions in greenhouse gas emissions. Additionally, the official versions of the Framework Convention on Climate Change and the Kyoto Protocol are included as a reference for the reader.

Front Matter....Pages I-XI Introduction....Pages 1-13 Employment in an Interregional Equilibrium....Pages 15-48 Employment Location in German Manufacturing....Pages 49-79 Interregional Migration in Germany....Pages 81-100 Regional Wage Formation....Pages 101-120 Regional Wage Flexibility in Germany....Pages 121-150 Summary and Outlook....Pages 151-154 Back Matter....Pages 155-207 Examines explanations for regional disparities in employment and unemployment in West Germany. Focuses on three basic issues: interregional employment location, the interregional mobility of labour and regional wage formation. Includes some trends from 1978 to 1994