Department Profiles
Research Profiles of the IWH Departments All doctoral students are allocated to one of the four research departments (Financial Markets – Laws, Regulations and Factor Markets –…
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Plant-based Bioeconomy in Central Germany – A Mapping of Actors, Industries and Places
Wilfried Ehrenfeld, Frieder Kropfhäußer
Technology Analysis and Strategic Management,
No. 5,
2017
Abstract
The bioeconomy links industrial and agricultural research and production and is expected to provide growth, particularly in rural areas. However, it is still unclear which companies, research institutes and universities make up the bioeconomy. This makes it difficult to evaluate the policy measures that support the bioeconomy. The aim of this article is to provide an inventory of relevant actors in the three Central German states of Saxony, Saxony-Anhalt and Thuringia. First we take an in-depth look at the different sectors, outline the industries involved, note the location and age of the enterprises and examine the distribution of important European industrial activity classification (NACE) codes. Our results underline the fact that established industry classifications are insufficient in identifying the plant-based bioeconomy population. We also question the overly optimistic statements regarding growth potentials in rural areas and employment potentials in general.
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The Contestable Markets Theory - Efficient Advice for Economic Policy
Christian Growitsch, Thomas Wein
Externe Publikationen,
2004
Abstract
During the nineties of the last century several formerly monopolistic markets (telecommunication, electricity, gas, and railway) have been deregulated in Germany based on European directives and theoretically inspired by the theory of contestable markets. The original contestable market theory implied three assumptions necessary to be satisfied to establish potential competition: Free market entry, market exit possible without any costs, and the price adjustment lag exceeding the entry lag. Our analysis shows that if the incumbent reduces its prices slowly (high adjustment lag) and the market entry can be performed quickly (low entry lag), a new competitor will be able to earn back sunk costs. Therefore it is not necessary that all three conditions be complied with for potential competition to exist. Applying this „revised“ contestable market theory to the deregulated sectors in Germany, natural monopolies can be identified in telecommunication sections local loops and local/regional connection networks, in the national electricity grid and the regional/local electricity distribution networks, in the national and regional/local gas transmission/distribution sections, and in the railroad network. These sections are not contestable due to sunk costs, expected high entry lags and a probably short price adjustment lag. They are identified as bottlenecks, which should be regulated. The function of system operators in energy and railroad are closely related to the non-contestable monopolistic networks.
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