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"Der Aufsatz beschreibt die Entwicklung regionaler Spezialisierung und geographischer Konzentration in Deutschland im Zeitraum 1993-2001. Es lassen sich weder zwingende Beweise für einen Vorgang der Spezialisierung deutscher Regionen noch für einen Konzentrationprozess der Industrie feststellen. Diese Schlussfolgerung gilt im großen und ganzen für alle Stufen der Ballung auf Gebietsebene." (Autorenreferat, IAB-Doku)

Regional unemployment rates in the European Union (EU-15) reveal a core-periphery structure. Large ?core? regions in the middle of the continent have low unemployment rates, whereas excessive mass unemployment is predominantly found in the peripheral regions at the outside borders of EU-15. This geographical pattern of unemployment rates follows the pattern of GDP per capita. That is, the regions with low (high) unemployment rates on average have comparatively high (low) real income levels. In this paper we try to understand this stylised fact with the help of a theoretical model that builds on two strings in the literature: the recent trade and location theories (like the ´new economic geography´) and the ´wage curve´. Standard models of the new location theories deal with regional disparities in production and income, but they usually assume full employment and are thus ill-equipped to study spatial unemployment disparities. The wage curve-approach, which explicitly shows how disparities in real wages and unemployment rates are interrelated, can not endogenously explain the origin of these asymmetries. In this paper, we combine these previously unrelated strings and develop a unified theoretical framework. We show that a core-periphery in real wages is associated and magnified by regional unemployment disparities. This wage curve relation is stable over time with an increasing returns technology. That is, the wage curve does not vanish as workers move from the periphery to the core, but it is rather reinforced by migration. These theoretical predictions of our model are in line with the empirical evidence.

A very prominent instrument of regional policy is to foster education and human capital for-mation in economically lagging regions. However, this type of regional policy might actually hurt instead of help the recipient areas. The reason is that individual geographical mobility increases with the personal skill level. Through education subsidies, particularly if targeted on relatively high skilled workers, individuals can cross some threshold level of qualification beyond which emigration pays off. Regional policies then result in a human capital flight harmful to individuals remaining in the economic periphery. This fatal result does not hold for policies that focus on the relatively low skilled.

Most itemized tax exemptions lead to significant deductions for a minority of the population only. This raises the question why the majority does not vote for the abolition of these tax privileges in exchange for lower tax rates. In this paper we show that a reform proposal may be voted down, even when the majority uses the exemption at stake below the average. Turning to an empirical application, we simulate the voting outcome on the proposal to abolish the tax deductibility of commuting expenses in Germany. Our model predicts that this proposal would be rejected, even though a comfortable majority has below-average deductions. Adapted from the source document.

SUMMARYWe analyse the impact of wages on employment growth in West German local industries (1993–2002), addressing the tension between cost and potentially offsetting demand side effects. We construct a neutralised regional wage level that is detached from various productivity influences. A positive value implies 'overly high' labour costs, but also high local purchasing power. A subsequent employment growth regression yields significantly negative effects associated with this indicator. Cost push effects dominate, but our estimates suggest that demand side repercussions have a mitigating effect. There is considerable variation across industries, but in no case we find a positive employment reaction.