The Relevance of Initial Conditions for the German Unification.

The authors analyze whether and how recent theories in which equilibria are path-dependent can be used to sustain the proposition that the adverse initial conditions are relevant for the long-run outcome of the German unification process. Though these theories are rather abstract, they strongly suggest that the actual analysis of the unification process should take into account the fact that initial conditions of the German unification are probably more important than the neoclassical theory predicts. Copyright 1993 by WWZ and Helbing & Lichtenhahn Verlag AG