An Empirical Aanalysis of the Development of German Circles: Regions in Germany on the Rise - Go East!

In the convergence analysis the following location factors are considered: unemployment rate, purchasing power, average age, broadband expansion, population density, private households and municipal debt. The convergence analysis is conducted on two difference scales (logarithmical and Z-standardized).  
 
In this way twelve catch-up and rising regions are identified, with the most explicit being the planning regions Havelland-Fläming, Prignitz-Oberhavel (both in Brandenburg) Western Saxony and Central Thuringia (all in eastern federal states). In addition, so-called rising and catch-up local districts are identified. These are districts that have developed very dynamically but are in only averagely or even below-average performing planning regions. Here too, eastern districts are overrepresented, most prominent are Chemnitz, Märkisch-Oderland and Dessau-Roßlau, but we also find prominent examples in the south-west with Primasens and Nürnberg.  
 
Overall, many eastern regions Germany show a very promising development, especially with regard to the labour market. However, there are also eastern regions that are identified as less developing regions. Thus, regional development in eastern Germany is becoming more differentiated, whereby the increasingly strong economic centers could in the long-term spill-over to more distant surrounding regions (as we see it already for Berlin and Brandenburg).
 
The corona crisis may even support this general convergence process, since the employment share in particularly vulnerable economic sectors seems particularly high in above-average developed regions in southern Germany and is rather inconspicuous in eastern regions.