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We use the synthetic control method to analyze the effect of face masks on the spread of COVID-19 in Germany. Our identification approach exploits regional variation in the point in time when wearing of face masks became mandatory in public transport and shops. Depending on the region we consider, we find that face masks reduced the number of newly registered severe acute respiratory syndrome coronavirus 2 infections between 15% and 75% over a period of 20 days after their mandatory introduction. Assessing the credibility of the various estimates, we conclude that face masks reduce the daily growth rate of reported infections by around 47%.

The emergence and rapid spread of novel variants of concern (VOC) of the coronavirus 2 constitute a major challenge for spatial disease surveillance. We explore the possibility to use close to real-time crowdsourced data on reported VOC cases (mainly the Alpha variant) at the local area level in Germany. The aim is to use these data for early-stage estimates of the statistical association between VOC reporting and the overall COVID-19 epidemiological development. For the first weeks in 2021 after international importation of VOC to Germany, our findings point to significant increases of up to 35–40% in the 7-day incidence rate and the hospitalization rate in regions with confirmed VOC cases compared to those without such cases. This is in line with simultaneously produced international evidence. We evaluate the sensitivity of our estimates to sampling errors associated with the collection of crowdsourced data. Overall, we find no statistical evidence for an over- or underestimation of effects once we account for differences in data representativeness at the regional level. This points to the potential use of crowdsourced data for spatial disease surveillance, local outbreak monitoring and public health decisions if no other data on new virus developments are available.

This work is concerned with the spatiotemporal dynamics of the coronavirus disease 2019 (COVID-19) in Germany. Our goal is twofold: first, we propose a novel spatial econometric model of the epidemic spread across NUTS-3 regions to identify the role played by commuting-to-work patterns for spatial disease transmission. Second, we explore if the imposed containment (lockdown) measures during the first pandemic wave in spring 2020 have affected the strength of this transmission channel. Our results from a spatial panel error correction model indicate that, without containment measures in place, commuting-to-work patterns were the first factor to significantly determine the spatial dynamics of daily COVID-19 cases in Germany. This indicates that job commuting, particularly during the initial phase of a pandemic wave, should be regarded and accordingly monitored as a relevant spatial transmission channel of COVID-19 in a system of economically interconnected regions. Our estimation results also provide evidence for the triggering role of local hot spots in disease transmission and point to the effectiveness of containment measures in mitigating the spread of the virus across German regions through reduced job commuting and other forms of mobility.

This work studies the linkages between spatially bound knowledge spillovers, internal research, and innovation (R&I) activities and firm productivity. Spillovers are modeled to emanate from intra- and extra-sectoral R&I activities in the firms’ regional business environments. We specifically test for non-linearities in the complex relationship between these internal and external knowledge sources and quantify their joint marginal effect on firm productivity. Our empirical results for a large panel of German manufacturing firms (1) underline the overall importance of knowledge spillovers in driving productivity and (2) point at distinct interactions between the included knowledge sources: First, we find that intra-sectoral knowledge spillovers only have a statistically significant effect on firm productivity when extra-sectoral spillovers are sufficiently large. Secondly, the link between knowledge spillovers and productivity varies with the level of the firms’ internal R&I activities.

Various forms of contact restrictions have been adopted in response to the Covid-19 pandemic. Around February 2021, rapid testing appeared as a new policy instrument. Some claim it may serve as a substitute for contact restrictions. We study the strength of this argument by evaluating the effects of a unique policy experiment: In March and April 2021, the city of Tübingen set up a testing scheme while relaxing contact restrictions. We compare case rates in Tübingen county to an appropriately identified control unit. We employ the synthetic control method. We base interpretations of our findings on an extended SEIR model. The experiment led to an increase in the reported case rate. This increase is robust across alternative statistical specifications. This is also due to more testing leading initially to more reported cases. An epidemiological model that corrects for 'more cases due to more testing' and 'reduced testing and reporting during the Easter holiday' confirms that the overall effect of the experiment led to more infections. The number of rapid tests were not sufficiently high in this experiment to compensate for more contacts and thereby infections caused by relaxing contact restrictions.

The EU enlargement process has thrust EU internal border regions into the spotlight of the European single market. This study explores how this specific macro-institutional change has impacted their socio-economic development. Tracking outcomes across four EU enlargement waves from 1986 to 2007, we identify integration effects across EU NUTS3 regions. Pooled over all waves and border regions, positive integration effects emerge for per capita GDP, labor productivity, patents per capita, and night light emissions in border regions compared to non-border areas. These effects diminish with increasing spatial distance from the enlargement border. At a detailed level, structural heterogeneities become evident across enlargement waves and region types. Internal border regions in established EU member countries benefit relatively in terms of GDP per capita and labor productivity but experience relative declines in employment rates and population. In contrast, border regions in new member countries, particularly during the 2004 and 2007 eastern enlargements, gain from deepening economic integration in terms of population and employment growth. Sector-specific estimations indicate post-enlargement specialization of economic activities in border regions in line with standard trade theories.

Although small and medium-sized enterprises increasingly utilize global sourcing strategies which involve the spatial relocation of their business activities, little is known about the effects of these strategies on firm performance—particularly firm innovativeness. Here, we analyze if alternative relocation strategies, specifically domestic and international relocations, differ in their performance effects on firm innovativeness by firm size and organizational configuration. Our econometric approach uses detailed micro data for German firms, and the empirical findings indicate that both product and process innovation rates negatively respond to international but not domestic relocations. Effects are more pronounced for smaller firms and are mainly associated with outsourcing arrangements. Only for large firms we observe a positive association between relocation and firm innovativeness. This indicates that short- to mid-run organizational costs associated with relocation activities can generally be better covered by larger firms.

For spatial data with a sufficiently long time dimension, the concept of «global» cointegration has been recently introduced to the econometrics research agenda. Global cointegration arises when non-stationary time series are cointegrated both within and between spatial units. In this paper, we analyze the role of globally cointegrated variable relationships using German regional data (NUTS1 level) for GDP, trade, and FDI activity during the period 1976-2005. Applying various homogeneous and heterogeneous panel data estimators to a Spatial Panel Error Correction Model (SpECM) for regional output growth allows us to analyze the short- and long-run impacts of internationalization activities. For the long-run cointegration equation, the empirical results support the hypothesis of export- and FDI-led growth. We also show that for export and outward FDI activity positive cross-regional effects are at work. Likewise, in the short-run SpECM specification, direct and indirect spatial externalities are found to be present. El concepto de cointegración global ha sido recientemente introducido en la agenda de la investigación econométrica para datos espaciales con una dimensión de tiempo suficientemente larga. La cointegración global surge cuando series temporales no estacionarias están cointegradas, tanto dentro como entre las unidades espaciales. En este trabajo se analiza el papel de las relaciones cointegradas globales a partir de datos regionales de Alemania (a nivel de NUTS1) para el PIB, el comercio y la Inversión Extranjera Directa (IED) durante el periodo 1976-2005. La aplicación de varios estimadores de datos de panel homogéneos y heterogéneos a un modelo de corrección de error espacial de panel (SpECM) al crecimiento de la producción regional, nos permite analizar los efectos a corto y largo plazo de la internacionalización de las actividades. Para la ecuación de cointegración de largo plazo, los resultados empíricos apoyan la hipótesis de que las exportaciones y la IED son los motores del crecimiento. También se observan externalidades interregionales positivas para la exportación y la IED. Asimismo, en la especificación del SpECM en el corto plazo, se detecta la presencia de externalidades espaciales directas e indirectas.

This paper tests the empirical validity of the neoclassical migration model in predicting German internal migration flows. We estimate static and dynamic migration functions for 97 Spatial Planning Regions between 1996 and 2006 using key labor market signals including income and unemployment differences among a broader set of explanatory variables. In addition to an aggregate specification we also estimate the model for age-group related subsamples. Our results give empirical support for the main transmission channels identified by the neoclassical framework - both at the aggregate level as well as for age-group specific estimates. Thereby, the impact of labor market signals is tested to be of greatestmagnitude for workforce relevant age groups and especially young cohorts between the ages of 18 to 25 and 25 to 30. This latter result emphasizes the prominent role played by labor market conditions in determining internal migration rates of the working population in Germany.

We apply panel econometrics to assess the causal linkages between education, research and innovation (R&I) and economic development for EU-28 countries over the time period 1998–2013. Since this period coincides with the biggest enlargement wave in the EU’s history, we particularly aim at identifying the degree of heterogeneity in this nexus between and within the groups of old (EU-15) and new member states (NMS-13). Our empirical results support the view that education- and R&I-driven economic development varies considerably by country groups and individual countries in the long and short run. As such, we get empirical support for a long-run ‘innovation paradox’ for the EU-15, while we find evidence for education-led economic development in EU-15 countries. Contrarily, for the NMS-13, R&I activities are identified as significant driver of economic development in the long and short run, whereas the link between education and economic development is found to be limited here. The application of poolability tests further shows that NMS-13 countries are more heterogeneous and clustered into sub-groups compared to the economic behaviour of EU-15 countries. The revealed patterns call for a careful reflexion of the current education and R&I policy practice at the EU level to account for prevailing heterogeneities across countries and country groups.