Employment Location in German Manufacturing

  • Thiess Büttner
Part of the ZEW Economic Studies book series (ZEW, volume 2)

Abstract

In the last section of the foregoing chapter, two directions for empirical research on the significance of agglomeration economies for the labor market were suggested, one referring to the observed pattern of employment, the other to its evolution over time. This chapter presents an empirical study for manufacturing employment along these lines.

Keywords

Employment Growth User Cost Agglomeration Economy Employment Location Local Demand 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. 1.
    Source: BfLR (1992). Because of data problems west Berlin is excluded from the dataset.Google Scholar
  2. 2.
    Cf. Pöschl (1992).Google Scholar
  3. 4.
    Cf. BfLR (1984).Google Scholar
  4. 5.
    See the appendix for the matching of different classifications.Google Scholar
  5. 6.
    Due to data protection rules the exact cut off point for no reporting is not zero but between zero and five. Therefore, these cases were treated as an employment of three.Google Scholar
  6. 7.
    Cf. Cowell (1995).Google Scholar
  7. 8.
    This applies to sectors 56 (public services) and 57 (social security services), according to the classification of the input-output table.Google Scholar
  8. 9.
    Provided the variables are bivariate normal, if the coefficient of correlation is larger than 0.193, it is significantly larger than zero at 5 % level of significance.Google Scholar
  9. 10.
    The official statistic distinguishes between firms as organizational units and establishments as localized units of production.Google Scholar
  10. 11.
    In difference to equation (2.56), the variables are not entered in deviations from the national mean. As a single industry is considered, its characteristics are simply picked up by the constant.Google Scholar
  11. 12.
    See footnote 44 in section 2.5.Google Scholar
  12. 13.
    In a study of regional firm formation Harhoff(1995a, 1995b) uses a quadratic specification of relative own employment and finds a decreasing positive effect which becomes negative at a higher level of own relative employment.Google Scholar
  13. 14.
    Today there are 327 districts. Five districts are excluded due to reforms of district territories (see appendix).Google Scholar
  14. 15.
    The reason here is that sums of employment are given for the districts one-digit industries at district level and for each two-digit industry for various sets of districts (see appendix).Google Scholar
  15. 16.
    See appendix for a list.Google Scholar
  16. 17.
    See Bernard / Durlauf (1996).Google Scholar
  17. 18.
    For the concept of leverage see, for instance, Davidson / McKinnon (1993).Google Scholar
  18. 19.
    See appendix for description of data and sources.Google Scholar
  19. 20.
    See Seitz (1996) for a recent study of suburbanization in German core-cities.Google Scholar
  20. 21.
    Henderson et al. (1995) report coefficients for a regression of current on lagged (log) employment between 0.365 and 0.647. cf. ibid. (1994), p. 1073.Google Scholar
  21. 22.
    Henderson et al. (1995) use the log of all other manufacturing employment and report significant coefficients between 0.223 and 0.986, cf. ibid., tables B3 and B4.Google Scholar
  22. 23.
    See Reynolds / Storey / Westhead (1994).Google Scholar
  23. 24.
    See Armstrong / Taylor (1993).Google Scholar
  24. 25.
    This result is quite different to Peschel / Bröcker (1988) and Bröcker (1089). They find no significant correlation between regional employment growth and industry-mix effects for the planning regions in West Germany for an even smaller time period. For comparison, the basic correlation between the actual and the predicted rate of employment growth in the present study is 0.27. When using the actual employment growth in percentage rather than in log differences the correlation reduces to 0.26. Provided the variables are bivariate normal, in the given case the critical value at 5 % level of significance is 0.094. Besides differences in the industry classification used the difference to the present study might arise from the focus on firms with at least 20 employees.Google Scholar
  25. 26.
    Cf. Bröcker (1989).Google Scholar
  26. 27.
    For a discussion of regional investment-promotion policy in Germany, see Franz / Schalk (1995) and the references listed there.Google Scholar
  27. 28.
    The coefficient of variation of the user cost of capital increases from 5.8 % in 1977, and 7.1 % in 1978 to a value of 15.8 % in 1989. (Own computations from the user cost of capital supplied by Franz / Schalk.)Google Scholar

Copyright information

© Springer-Verlag Berlin Heidelberg 1999

Authors and Affiliations

  • Thiess Büttner
    • 1
  1. 1.Centre for European Economic Research (ZEW)MannheimGermany

Personalised recommendations