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| The study deals with the question whether external (foreign and West German) investors in East Germany induce technological spillover effects in favor of domestic firms. It ties in with a number of other econometric spillover studies especially for transition economies hich show rather mixed and inconclusive results so far. Different from existing spillover analyses this study allows for a much deeper regional breakdown up toRaumordnungsregionen and uses a branch classification that explicitly considers intermediate and investment good linkages. The regression results show no positive correlation between the presence of external investors and domestic firms’ productivity no matter which regional breakdown is looked at (East Germany as a whole federal states or Raumordnungsregionen). Technology spillovers which may exist in particular cases are obviously not strong enough to increase the domestic firms’ overall productivity |
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