Chang Woon Nam

Regional Technology Policy and Factors Shaping Local Innovation Networks in Small German Cities

Local innovation networks are considered to be important to innovation and technological change and to growth prospects of regions and cities in Germany. When analysing the local (or regional) innovation system, one should consequently not only investigate horizontal and vertical relations among firms but also the contacts with universities and other research institutions. Furthermore, the role of government agencies and interest groups that provide financial support as well as commercial and technical information should also be taken into account. However, the review of relevant theoretical and empirical investigations related to the German experience shows that such innovation and R&D cooperation networks appear to be less significant than expected. In general various regional technology policy measures adopted in German states (the provision of research infrastructure, establishment of technology centres, innovative small and medium sized enterprises support programmes, etc.) have been more successful in economically better-off large cities than in the rural areas. Apart from offering a critical review of relevant theoretical and empirical research, this study introduces the present regional technology and R&D promotion policies in German states and examines the local innovation systems, taking Landshut as an example.

The Role of Tax Depreciation for Investment Decisions: A Comparison of European Transition Countries

This study compares incentive effects of various tax depreciation methods currently adopted in European transition economies. In these countries, straight-line, geometric-degressive, and accelerated depreciation measures are quite popular, in combination with different corporate tax rates. Their generosity is determined on the basis of Samuelsons true economic depreciation. For this purpose, the present value model is applied under the particular consideration of different financial structures. In this context, the traditional Modigliani-Miller theorem for capital structure is revisited. Furthermore, the aspect of inflation is integrated into the model. The central issue is that the historical cost accounting method generally applied for the calculation of the corporate tax base causes fictitious profits in inflationary phases that are also taxed. Therefore, in an inflationary period, generous tax depreciation provisions do not promote private investment as designed, but partly compensate such additional tax burdens caused by inflation.

Taxation of Nonprofit Associations in an International Comparison

The objective of this study is an investigation of tax regulations for nonprofit associations (NPAs) in EU countries, Japan, and the United States. Following a brief description of qualification principles for NPAs, treatment of business units, or liability issues, a particular focus is put on a comparison of regulations concerning the taxation of current profits, inheritance, and gift taxes and the tax treatment of contributions and membership fees. In general, a strong similarity among the examined developed countries can be found for the different aspects considered, but significant differences also exist.

Can Reform Models of Value Added Taxation Stop the VAT Evasion and Revenue Shortfalls in the EU

Abstract VAT evasion caused by the growth of carousel fraud has recently led to significant VAT revenue losses in the EU. Carousel fraud works such that intra‐EU firms repeatedly carry out cross‐border supply and purchase of goods and services, leading to the fraudulent retention of revenue. This study discusses three reform models of the VAT system in Germany, whose implementation would open up further possibilities for tax evasion and lead to a considerable increase in administrative costs.

VAT Evasion and Its Consequences for Macroeconomic Clearing in the EU

Full movement from the destination principle to the origin principle would lead to changes in VAT revenues in EU countries. Hence a clearing mechanism is necessary to rectify such imbalances. To estimate the relevance of VAT evasion this study quantifies the annual amounts of hypothetical VAT revenues based on national-accounts data. The relation between hypothetical and collected revenues indicates the tax collection performance rate, and this determines the extent of VAT evasion. Macroeconomic clearing is supposed to occur in the EU, based on the national share of hypothetical revenues of the member countries. Yet this system suffers from adverse incentives for individual nations, since those with a higher evasion ratio will gain: For those countries with an above-EU-average evasion rate the sum of apportioned VAT revenues will be larger than the anticipated collected revenues in the case of prevailing current tax practice.

The Principles of Parallel Development of Fiscal Capacity between State and Municipalities as Useful Benchmarks for the Determination of the Inter-governmental Grants in Germany

The conventional theoretical and empirical references related to the inter-governmental fiscal transfer system in Germany appear to heavily concentrate on the issues surrounding the measurement of local expenditure needs of a municipality and their coverage through the down-flow grants when the municipal tax revenue is insufficient to match the needs. This study introduces additional important research fields in this context. Firstly, it attempts to analyse the role of the development of tax revenue and fiscal power of the grant provider (the State) as well as the joint financial relationship between the State and (different types of rural and urban) municipalities in the determination of inter-governmental grants. Secondly, when the total volume of the State grants is determined, this study examines in the next step under the particular consideration of different tax capacities in varied categories of municipalities, how this amount should be horizontally distributed among these groups to achieve the equal growth of hypothetical per capita fiscal capacity.

Determination of Fees for Local Services under the Consideration of Public and Management Objectives

Anita Dehne, Peter Friedrich und Chang Woon Nam; Bestimmung kommunaler Gebuhren unter Berucksichtigung von offentlichen Zielen und Managementzielen Bestimmung von Gebuhren; Effizienz; kommunale Leistungen; Management; Trager von kommunalen Unternehmen Meistens versuchen Autoren im Rahmen wohlfahrtsorientierter Beitrage zur Bemessung kommunaler Gebuhren, allokationseffiziente Gebuhrenhohen fur Gemeindeunternehmen zu ermitteln. Sie unterstellen, dass Faktoreffizienz in Gemeindeunternehmen herrscht und somit die Unternehmen zu Minimalkosten produzieren. Die Beziehungen zwischen dem ∗ The authors are grateful to two anonymous referees for helpful comments. Responsibility for errors remains the authors’. kommunalen Eigentumer und dem Management sowie deren Konsequenzen erfahren gewohnlich keine Beachtung. Wir untersuchen hingegen, ob sowohl Allokationseffizienz als auch Faktoreffizienz erreichbar sind, falls solche Abhangigkeiten Berucksichtigung finden. Ware dies der Fall, dann fuhrt die Wohlfahrtsmaximierung bei Vorliegen von Monopolen zur Grenzkostenpreisregel. Die Anwendung dieser Regel ruft in praxi jedoch mannigfaltige Schwierigkeiten hervor und die implizite Annahme herrschender Faktoreffizienz reflektiert die wirtschaftliche Wirklichkeit ungenugend. Dieses Ergebnis bestatigt ein Modell zur Bestimmung kommunaler Gebuhren, bei dem ein Gemeindeunternehmen mittels einer Vollkostendeckungsvorschrift reguliert wird, das Unternehmensmanagement jedoch sowohl Autonomie uber den Einsatz der Produktionsfaktoren als auch hinsichtlich der Bestimmung der Produktionsmengen besitzt und die Moglichkeiten nutzt, die von ihm praferierten Ziele zu verfolgen. Aktive Verhandlungen zwischen dem kommunalen Trager und dem Management werden ebenfalls in einem Modell analysiert. Nur in Ausnahmefallen wird Faktoreffizienz herrschen. Bernhard Hirsch, Michael Schmiedke und Stefan Reemts Anreizsysteme fur Soldaten der Bundeswehr – Theoretische Analyse und Gestaltungsempfehlungen Anreize; Anreizsysteme; Belohnungen; Bundeswehr; Leistungsmotivation; Motivation von Soldaten Dieser Beitrag verfolgt zwei Ziele. Zum einen werden die theoretischen Grundlagen und die spezifischen organisatorischen Rahmenbedingungen der Einfuhrung eines Anreizsystems fur Soldaten der Bundeswehr beschrieben. Zum anderen stellen wir eine theoriegeleitete Konzeption eines Gestaltungsansatzes fur ein langfristig orientiertes Anreizsystem innerhalb der Bundeswehr fur deren Soldaten vor. Wir empfehlen der Bundeswehr die Einfuhrung eines Anreizsystems, das sowohl der spezifischen intrinsischen Motivation von Soldaten gerecht wird als auch monetare Leistungsbelohnungen enthalt. Damit tragen wir den geanderten Anforderungen an die Soldaten der Bundeswehr Rechnung.

Urban shrinkage and resurgence in Germany

This article questions the strict parallelism of demographic and economic development in characterising urban shrinkage in Germany. As the cases of several Ruhr cities and East German cities prove, urban economic growth can be achieved thanks to the substantial presence of modern industries and business services, and despite declines in population size. Serious shrinkages of Halle, Cottbus and Schwerin are primarily due to failures in the post-industrial transformation process. Recent policy measures strongly oriented towards slowing the downsizing process of population (via e.g. urban regeneration strategies) do not appear to be sufficient for achieving urban resurgence in these cities. More active industrial policy measures are required there to create a competitive high-tech manufacturing sector, to stimulate innovation activities and to boost its growth interdependence with modern local services and R&D infrastructure.

Innovation-Oriented Land-Use Policy at the Sub-National Level: Case Study Germany

This study investigates major features of land-use strategies that German municipalities have adopted to attract innovative firms (IFs). In this context a two-stage competition model is introduced: firstly a municipality should solve economic and interest conflicts related to its preference for high-quality sites for IFs against the land needs of simple manufacturers. The second part of the model describes location competition among municipalities with high-quality sites for the location of IFs. German municipal land-use policy is well combined with industrial policy; this paper reveals the strengths and weaknesses of the urban real estate market in Potsdam, and its future opportunities and risks as the location of different economic activities are determined in the planning process. Science Park Adlershof (Berlin) is an output of the spatial-oriented technology policy, which creates incubators for innovative SMEs. Municipalities also cooperate, since it provides larger sites, generates economies of scale and contributes to a smooth suburbanisation process (see Leipzig).

Shadow Market Area for Air Pollutants

This study identifies the shadow market area of air pollutants on the basis of the Gaussian plume model. Since pollutants are dispersed by wind, transport costs are irrelevant in its formation. Pollutant distribution on the ground level has an asymmetric bell shape in the wind direction. In addition to the linear functions, the exponential and quadratic shadow price functions are considered for the compensation of a health hazard to consumers, where the strict liability in the framework of the Coase theorem applies. The shadow market area for pollutants is shell shaped. This specific characteristic has an implication for market boundaries between polluters and their location decisions.