New firm location decisions, relative to incumbents may be based on a choice between two types of advantages: natural advantages or those that arise from social embeddedness, the latter of which may particularly include knowledge spillovers. We analyze the relative importance of geographically...

We analyze the extent to which endogenous cultural amenities affect the spatial equilibrium share of high-human-capital employees. To overcome endogeneity, we draw on a quasi-natural experiment in German history and exploit the exogenous spatial distribution of baroque opera houses built as a...

This paper analyzes the escape-entry incentive for innovation by incumbent firms. The threat posed by the possibility of leading-edge firms entering the market influences incumbent innovation. To overcome problems of endogeneity, we apply an instrumental variable approach to analyze a rich...

Research analyzing the importance of human capital for innovation usually focuses on secondary and tertiary education. This paper takes a different perspective by focusing on in-firm training. We argue that continuous training guarantees access to leading-edge knowledge and thus increases a...

We investigate the effect of social capital access on entrepreneurship. Social capital helps entrepreneurs to overcome resource constraints. This is especially important in small communities where we often see a lack of market-oriented institutions such as venture capital firms. Entrepreneurs...

We ask whether and what kind of unique factors influence the innovativeness of firms in clusters across geographic regions and industrial sectors. We provide evidence for the driving forces of firm innovativeness in different cluster types. Distinguishing between hierarchical clusters of mature...

This paper combines the empirical finding of a functional specialization of cities with regional dynamics.We distinguish between cities dominated by headquarters and service firms (urban agglomerations), those with large stand-alone production plants in one sector (industrial agglomerations),...

Globalization has had an enormous impact on traditional industrial structures. It almost seems that everything is everywhere the same. And yet, in reality, some regions in a single industrialized country enjoy rapid economic growth while others are downsizing or stagnating. Thus there must be...

After World War II, about 8 million ethnic Germans - so called expellees- were forced to leave their homelands and settle within the new bordersof West Germany. Subsequently, a law (Federal Expellee Law) wasintroduced to foster their labor market integration. We evaluate thislaw by comparing the...