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This is an abridged version of a report that appeared in the Wochenbericht des DIW, no. 3/98. The full version of the report is available in German: Kieler Diskussionsbeiträge, no. 310/311 and in the Forschungsreihe des IWH, no. 2/1998. The previous sixteen reports have also appeared in the Economic Bulletin.
In some cases insufficient attention was paid to this phenomenon, so that the sale of research and development capacities seriously undermined the very substance of privatised enterprises.
The housing sector constitutes an exception to this general rule. Although in the seven years since unification a large number of housing units have been built by firms and private individuals, and a considerable proportion of the existing housing stock was returned to the former owners or their beneficiaries, most rented housing remains in local authority ownership. Although it has been decided—within the framework of an agreement on the legacy of GDR debt reached with central government—that some of these housing units are to be sold to tenants, it appears that it is proving difficult to implement this policy in practice.
In addition, the self-employed in hotel and catering—for whom no figures are available—need to be added. In the GDR hotel and catering was considered as part of the trade sector; of the 40 000 self-employed in this sector, only a small proportion was involved in hotel and catering, however.
To some extent, however, this did not involve additional jobs, but rather those forced out of other sectors or the public sector in the course of privatisation and subsequently registered in the statistics as employment in service companies. Such statistical reclassification probably only played a significant role until 1992; by then privatisation had largely been completed. This effect was particularly pronounced in 1990.
It cannot be determined to what extent the sample studied is representative, as sufficient information is not available on the total population. However, given the large number of responses received, it is improbable that the group is atypical. No attempt is made to portray the results for service firms as a whole, because of the heterogeneous nature of the sample.
The VVC did not evaluate creditworthiness in one quarter of the firms involved. In the vast majority of cases these consisted of young firms on which the information available on payments behaviour and corporate development was considered not sufficiently reliable.
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DIW., IfW. & IWH. Micro-and macroeconomic adjustment processes in east Germany—Seventeenth report. Economic Bulletin 35, 3–14 (1998). https://doi.org/10.1007/s10160-998-0002-z
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DOI: https://doi.org/10.1007/s10160-998-0002-z