Interrelationship between Industrial and Innovation Development in East Germany
G. HEIMPOLD
Deputy Head of Department at Halle Institute for Economic Research, Leibniz Association, Kleine Maerkerstrasse 8, D-06108 Halle (Saale), Germany
Keywords: East Germany, West Germany, R&D, innovation, economic convergence
Abstract
The article demonstrates that the most important reason for the slowdown and stagnation of economic convergence in East Germany is the weakness in terms of research and development and innovation. It analyzes the interrelationship between industrial and innovative development in the East German federal states since 1990. The article shows how the East German industry sector and its R&D activities looked like in the late 1980s and which transition it had undergone in the course of privatization. The industrial development of the new federal states after 1990 is analyzed. The paper reveals structural shortcomings in East Germany's economy and considers their impact on the progress in R&D.
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