Fritsch, Michael Kristalova, Maria Wyrwich, Michael
Year of Publication:
Jena Economic Research Papers No. 2020-014
We investigate the reasons for the pronounced regional differences of new business formation after the transformation from a socialist planned system to a market economy in East Germany. Relatively high start-up rates are found in regions that had a well-qualified workforce and a relatively high share of remaining self-employed at the end of the socialist period. This also holds for high-tech manufacturing start-ups. Based on our conclusion that policy should account for these initial regional conditions, we use two criteria to introduce a classification of regions.
Entrepreneurship new business formation regional conditions transformation East Germany