Michael Fritsch (p), Michael Wyrwich

East German regions show considerable differences in their ability to cope with the challenges of the transition from a socialist regime to a western type market economy. While some regions particularly in the South and those adjacent to Berlin perform relatively well many other places fall behind.
Analyzing these differences of regional performance we follow the idea that current regional development is strongly influenced by their economic history so that they follow specific growth trajectories (Fritsch and Wyrwich 2019). Using a rich variety of data for different time periods we identify a particularly significant role of entrepreneurship in terms of current and historical levels of self-employment. We find that those regions with a relatively high share of remaining self-employment at the end of the socialist period showed high levels of new business formation and growth. Accounting for the economic history of the regions shows strong effects of the levels of self-employment in pre-socialist times more than a century ago. Many regions that had high levels of remaining self-employment at the end of the socialist period and performed relatively well in the post-socialist era have a long-lasting tradition of entrepreneurship that has considerable effect on current their development.
This effect of current and historical self-employment is very robust and appears to be much stronger than the influence of other factors that are commonly associated with regional growth, such as location, population density, industry structure, and knowledge. While we find some positive effect for the qualification of the regional workforce at the end of the socialist period, such an effect is comparatively weak or insignificant for historical levels of knowledge and innovation. The results indicate that entrepreneurship is a key factor behind regional growth trajectories. In particular high levels of self employment make regions more resilient to disruptive changes of their economic framework conditions.

Reference:
Fritsch, M. and M. Wyrwich (2019). Regional Trajectories of Entrepreneurship, Knowledge, and Growth―The Role of History and Culture. Cham: Springer. https://doi.org/10.1007/978-3-319-97782-9

Michael Fritsch, Maria Kristalova (p), Michael Wyrwich

see extended abstract

Rüdiger Hamm (p), Anna Herzog (p)

The paper investigates how an urban masterplan can be used to catalyse civic and entrepreneurial engagement to trigger a broad resurgence process within a medium-sized city. Therefore, it dwells on the masterplan project MG 3.0 in Mönchengladbach, which is often described as the initial impulse of a dynamic resurgence process – a confident statement the authors want to question. The exploratory case study highlights the significance of place-based leadership in developing an overarching vision of the urban future. It also emphasises the leading role of entrepreneurial engagement in terms of Corporate Urban Responsibility in driving the resurgence process.

See full (draft) paper

Michael Wyrwich (p), Christian Fisch, Thi Lanh Nguyen, Joern Block

We study the case of Vietnam to assess the long-lasting role of institutional and historical legacy on entrepreneurial outcomes. In particular, we investigate the detrimental effect of socialist institutions on entrepreneurship. Vietnam offers a unique quasi-experimental set-ting because the country was divided into the socialist North and the nonsocialist South for a relatively short period of two decades. After re-unification the South adopted the institution-al framework conditions of the North. To assess the relationship between socialist history and entrepreneurship in this unique setting, we survey more than 3,000 North and South Vi-etnamese individuals more than four decades after the re-unification of the country. We find that North Vietnamese respondents have lower entrepreneurship intention, are less likely to select into entrepreneurship education programs, and are less willing to engage in business takeover. These patterns indicate the persistence of a long-lasting influence of historical differences in institutional framework conditions on entrepreneurship. The long-run effect of socialism on entrepreneurship is apparently deeper than previously discovered in the promi-nent case of Germany, where differences in institutional treatment lasted for much longer and ended more recently.