Subsidies granted by the German federal government decreased in the 1998–2004 period. Since 2005, subsidies have increased. The transfers to the compulsory health insurance system were raised by very large amounts. Moreover, the subsidies for re-integrating the unemployed were raised. The...

Mit der Entscheidung des Bundesverfassungsgerichts zum Länderfinanzausgleich steht auch die Berücksichtigung der Seehafenlasten der Küstenländer auf dem Prüfstand. Ökonomische Erwägungen sprechen dafür, die Belastungen dieser Länder durch Investitionen in die Hafeninfrastruktur künftig...

Eastern Germany's recovery from the unification shockʺ has been characterized by deep structural change with apparent repercussions for the West as well and an integration process involving both capital deepening (extensive and intensive investment) and labor thinning (net out-migration). I...

The paper concentrates on the question whether the low level of productivity in East Germany can be explained by deficits in the stock of human capital. It is shown that figures on formalʺ qualifications yield a too optimistic view on human capital endowments; in fact, the effective stock on...

Analysis in terms of the two-sector open economy shows that in bringing the market economy to East Germany, West Germany seems to have disregarded important fundamentals. Premature formation of a currency union led to a substantial real appreciation of the East German currency. Premature...

Die Finanzhilfen der Bundesländer und ihrer Gemeinden sind beträchtlich. Für das Jahr 2001 wurde ein Betrag von insgesamt 70,6 Mrd. Euro ermittelt. Er entspricht mehr als der Hälfte des gesamten Lohnsteueraufkommens, das freilich um das Kindergeld reduziert ist, oder 3,4 Prozent des...

In einer Regressionsanalyse werden mögliche Determinanten kommunaler Verschuldung untersucht. Von erheblicher Bedeutung sind die SGBII-Quote und das Zusammenspiel aus Einwohnerzahl und Einwohnerdichte. Zudem spielt die Länderzugehörigkeit der Kommunen eine große Rolle. Unterschiede gibt es...

This paper indicates that East Germany's unemployment originates primarily in the labor market, caused by the fast wage adjustment after German reunification. We model the resulting labor market traps in a search and matching framework, show that they are difficult to overcome, and provide...

This paper addresses the question of why prolonged regional unemployment differentials tend to persist even after their proximate causes have been reversed (e.g., after wages in the highunemployment regions have fallen relative to those in the low-unemployment regions). We suggest that the...

The East German labor market has hardly made any progress since German reunification, despite massive migration flows and support from the West. We argue that East Germany is in trouble precisely because of the support it has received. This paper explores the phenomenon of "the caring hand that...