Geographic concentration of innovative activities in Germany

The geographic concentration of industries has attracted much attention in recent economic and geographic literature. One mechanism employed to explain the emergence and comparative advantage of industrial agglomerations is based on the relationship between industrial agglomeration and local knowledge production and diffusion, and the resulting innovation activities. This paper analyses this relationship by identifying geographic concentrations of innovation activities and examining different causes for the emergence of these concentrations. The paper applies different concentration measures to patent data for German regions. We analyse 43 technological fields separately to identify which of these technologies tend to cluster in geographic space. The results are discussed in light of theoretical predictions of why specific technological fields concentrate while others do not. These explanations include the concentration of industrial activities, the role of dominant firms, dependence on scientific knowledge, and local interactions.     

Taxes,female labour supply and household income: differences between the Netherlands and the Federal Republic of Germany

The article investigates the effect of taxes and social premiums on female labour supply and household income. A comparison is made between labour supply and household income between the Netherlands and the Federal Republic of Germany in 1992. A discrete choice model for labour supply is used in which taxes and social premiums are implicitly incorporated. As male labour supply is highly inelastic an individual, male chauvinist model is used. The estimated models are used to simulate the effect of the differences in the tax and social premium system on the differences in labour supply and income between both countries. The results indicate that labour force participation is higher the more individualized the system. The German system leads to a lower tax burden compared to the Dutch system. It is concluded that differences in the tax and social premium system between both countries have hardly any influence on the differences in the inequality of net household labour income. There is evidence that the German system leads to a slightly more unequal distribution of household income. It is also concluded that although the tax and social premium system does influence labour supply and income, it can be doubted whether these effects are substantial.     

Flights and contagion—An empirical analysis of stock–bond correlations

This paper analyzes the existence of flights from stocks to bonds and vice versa. We propose a definition and a test for flight-to-quality, flight-from-quality and cross-asset contagion and examine their characteristics and effects for the financial system. The empirical analysis for eight developed countries including the US, the UK, Germany and Japan shows that flights exist and are a common feature in many crises episodes. Our findings also reveal that flights are not merely country-specific events but occur simultaneously across countries. This indicates that there is a link between the occurrence of flights and cross-country contagion. Moreover, we show that flights enhance the resiliency of the financial markets by providing diversification benefits in times when they are needed most.     

An Institution of Corporate Social Responsibility (CSR) in Multi-National Corporations (MNCs): Form and Implications

This article investigates corporate social responsibility (CSR) as an institution within UK multi-national corporations (MNCs). In the context of the literature on the institutionalization of CSR and on critical CSR, it presents two main findings. First, it contributes to the CSR mainstream literature by confirming that CSR has not only become institutionalized in society but that a form of this institution is also present within MNCs. Secondly, it contributes to the critical CSR literature by suggesting that unlike broader notions of CSR shared between multiple stakeholders, MNCs practise a form of CSR that undermines the broader stakeholder concept. By increasingly focusing on strategic forms of CSR activity, MNCs are moving away from a societal understanding of CSR that focuses on redressing the impacts of their operations through stakeholder concerns, back to any activity that supports traditional business imperatives. The implications of this shift are considered using institutional theory to evaluate macro-institutional pressures for CSR activity and the agency of powerful incumbents in the contested field of CSR.     

Capital Structure Theory: Evidence from European Property Companies' Capital Offerings

This study examines the stock price reactions on announcements of both equity and debt offerings by European property companies. The unique setting in which corporate tax rates vary between different countries enables us to test established theories in the field of capital structure. In accordance with theory, we find a negative price reaction on equity offering announcements, which is less severe for low-tax countries and positive price reactions on the announcements of debt offerings. Besides tax arguments, we also test alternative explanations by analyzing variations in stock reactions based on differences in the relative size of the issue, the pre-offer leverage, the underlying property types, and operational performance. The results show that corporate taxation, issue size, and operational performance are significant explanatory factors in the negative price reactions.     

The Extent and Evolution of Productivity Deficiency in Eastern Germany

Since the German re-unification in 1990, Eastern Germany has been a transition economy. After a phase of catching up in productivity with Western Germany from 1991 to 1996, growth rates in the producing sector have dropped below those in Western Germany since 1997. This study investigates whether this macroeconomic picture holds at the microeconomic level. For the special case of Eastern Germany, I suggest identifying productivity gaps by using comparable Western German firms as a “productivity benchmark”. Applying an econometric matching procedure allows to study the productivity gap at the firm level in detail. Besides labor and capital, other factors like innovation and firm ownership are taken into account. The macroeconomic facts are broadly confirmed: a significant gap has remained in recent years. Moreover, Eastern German innovators perform worse than their Western German pendants, and firms owned by Western German or foreign companies perform better than those owned by Eastern German entities.