The Impact of EU Enlargement on European Border Regions

EU enlargement is supposed to entail profound impact on the location of economic activities in Europe. Although there is concern about the implications of enlargement for regional disparities in the EU, corresponding empirical results are still rare. The objective of this analysis is to provide empirical evidence on enlargement effects with a special focus on border regions in the EU27 since they are likely to play a critical role within the spatial dynamics initiated by integration. Departing from a three-region economic geography model we investigate whether changes in market access released by integration result in above-average integration benefits in internal border regions.

EU enlargement and convergence: Does market access matter?

Economic integration in Europe has been accompanied by concerns about the impact of integration on regional disparities in the EU. The purpose of this paper is to investigate the effects of the most recent EU enlargement on convergence among countries and regions in the EU27. Departing from a new economic geography framework, we focus on integration effects caused by changes in market access released by the reduction of trade impediments. Special attention is paid to the catching-up process of the new member states and the development of regional disparities within the Eastern European countries. The results point to a catching-up process of the new member states. However, at the same time regional disparities within the NMS increase. Changes in market access seem to foster these processes at the national and regional level since the Eastern European countries achieve highest growth of market potentials due to declining barriers to trade. Moreover, the more prosperous regions in Eastern Europe realize the strongest benefits. However, taking these integration effects into account does not significantly alter the findings of our convergence analysis. --Integration,market access,EU enlargement,convergence

Integration and Labour Markets in European Border regions

Border regions are likely to play a critical role within the special dynamics initiated by the enlargement of the EU. This paper deals with the effects of integration on labour market conditions in border regions. Within the framework of different theoretical approaches the effects of integration on location conditions and labour markets in border regions are analysed. Furthermore, we investigate empirically the degree of labour market integration in European border regions. Measures of spatial association are applied as indicators for the intensity of integration among neighbouring labour markets. The results of an analysis of per capita income and unemployment for the period 1995 to 2000 point at a measurable spatial segmentation of labour markets even among highly integrated EU15 countries. On average, border regions in the EU are characterised by lower degree of labour market integration than non-border areas due to significant border impediments that hamper equilibrating forces between labour markets on both sides of national frontiers. JEL classification: F22, J61, R23 Keywords: European Integration, Labour Market Disparities, Border Regions, Spatial Dependence

Threshold Effects and Regional Economic Growth – Evidence from West Germany

We study an overlapping generations model of human capital accumulation with threshold effects using regional data for West Germany. Our basic goal is to shed light on what makes German regions grow. The paper finds that the relative income distribution appears to be stratifying into a trimodal distribution. Thus, application of the threshold model to a real world case, here West Germany, shows that the model might help to explain regional growth patterns.regional economic growth, human capital, Germany

Migration and Innovation - Does Cultural Diversity Matter for Regional R&D Activity?

Recent theoretical research deals with economic costs and benefits of cultural diversity related to immigration. Empirical evidence regarding the impact of cultural diversity on economic performance is still scarce. This paper aims at investigating the effects of diversity on innovation and at providing corresponding empirical evidence. We apply the knowledge production function approach to investigate the significance of cultural diversity of work force for innovation output. The regression analysis considers the determinants of regional innovation, focusing on the effect of diversity, for a cross-section of German regions in the period 1995 to 2000.

Regional disparities in employment of high-skilled foreigners: Determinants and options for migration policy in Germany

We investigate the regional disparities in high-skilled foreign employment in Germany. The importance of different factors which attract highly qualified migrants to specific regions and the role of labour-migration policy is analysed. Our results show that labour-market variables as well as the supply of tertiary education are important for the location choice. Based on these empirical results we discuss options of decentralized migration policy in Germany. --Migration,regional disparities,labour-migration policy,Germany

Migration and innovation: Does cultural diversity matter for regional R&D activity?

"Recent theoretical research deals with economic costs and benefits of cultural diversity related to immigration. However, empirical evidence regarding the impact of cultural diversity on economic performance is still scarce. This paper investigates the significance of cultural diversity of the workforce on innovation output for a cross-section of German regions. The findings indicate that cultural diversity indeed affects innovative activity. The results suggest that differences in knowledge and capabilities of workers from diverse cultural backgrounds enhance performance of regional R&D sectors. However, education levels are also important. Diversity among highly qualified employees has the strongest impact on innovation output." (Author's abstract, IAB-Doku) ((en))Einwanderung - Auswirkungen, kulturelle Faktoren, Forschung und Entwicklung, Innovationspotenzial, Innovationsfähigkeit, regionale Faktoren, Arbeitskräftestruktur, regionale Herkunft, ausländische Arbeitnehmer, Wissensarbeit, Wissenstransfer, regionale Disparität, Arbeitsmigration - Auswirkungen, Migranten, Qualifikationsniveau, Patente - Quote, regionaler Vergleich

Convergence and the effects of spatial interaction

Since the beginning of the 1990s, the issue of income convergence has received considerable attention in economic research. Although a vast number of empirical studies has emerged, evidence on the role of spatial interaction is still rather scarce. The present paper is an attempt to provide additional information on the spatial aspect of convergence. Spatial econometric methods are used to investigate regional convergence in West Germany. The results indicate that spatial interaction is an important element of regional growth. However, considering spatial effects does not alter the general conclusion that regional income growth is characterised by a process of convergence

Benefits of dense labour markets - Evidence from transitions to employment in Germany

Agglomeration economies may impact on productivity in different ways. Up to now, only a few papers try to provide evidence on the underlying mechanisms that might give rise to a positive correlation between agglomeration and wages. In this analysis we focus on the matching mechanism, i.e. the hypothesis that the size of the local labour market allows for better matching of job seekers and vacancies. Better matches in turn are supposed to give rise to higher productivity. We aim at providing new evidence on the importance of the matching mechanism and investigate the effects of the density of local labour markets on the wages of new employment relationships. The analysis is based on a large micro data set that offers detailed information on labour market biographies of workers in Germany. We apply the two-stage regression approach proposed by Combes et al. (2008) and distinguish between different types of transition, i.e. job-to-job transitions as well as transitions from shor tand long-term unemployment. The results point to rather small positive effects on productivity: a doubling of the employment density increases the productivity of new employment relationships by 1.1% to 1.4%. Moreover, the findings indicate that the benefits of a better match might only accrue to persons with a job-to-job transition as well as short-term unemployed. We detect no important impact of agglomeration for transitions from long-term nonemployment

Market Potential and Regional Disparities in Europe

A basic result of new economic geography models is that the proximity to consumer markets impacts wages and employment within regions. While there is a bulk of theoretical literature on new economic geography related empirical tests are still scarce. The present paper aims at providing some evidence on the validity of the forces emphasised by new economic geography models. The empirical analysis focuses on the relationship between the market potential and regional development in Europe. Consumers and purchasing power are unevenly distributed across space. The study analyses the significance of the market potential for the development of a cross section of European regions taking into account the effects of national borders as well. In the course of integration the significance of borders as impediments to trade and factor mobility declines presumably affecting the market potential especially in border regions. The regression analysis covers the period between 1975 and 1998