Unification fundamentally changed the terms of quantitative macroeconomic analysis for Germany. Two main areas concerned are data availability for the eastern part of Germany and structural changes within the behavioural equations after unification. Our paper presents results from the estimation...

The macroeconomic development in West Germany in the aftermath of unification was characterized by a boom period in 1990/1991, a deep recession in 1992/1993 and a slow recovery since then. In East Germany, in contrast, unification induced a breakdown of production and employment followed by a...

In this paper, the determinants of innovation behaviour and investment are explored with a large micro-data panel from West-German manufacturing firms. The estimates are discussed within a microeconomic model with monopolistic competition, demand uncertainty and a delayed adjustment of...

"Despite the currently improving economic forecasts, the present labour market situation in Germany does not look too good. Especially the high and further increasing unemployment in eastern Germany is a key problem for current economic policy. Rigidities on the labour market, which manifest...

In this paper, a theoretical model of the impact of product and process innovations on output, capacity utilization, employment, and prices is developed. The model is estimated with a unique set of microdata from West German manufacturing firms. The empirical results reveal that innovative firms...

Many theoretical analyses of the sources of economic growth focus on knowledge spillovers and scale economies to explain growth endogenously. The contribution of this paper is to shed some light on these arguments by an empirical investigation based on a production function framework. Sectoral...