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Research · Data Sources

Data as Infrastructure

The evidence behind the East–West Germany project.

Most accounts of East and West Germany are told through national averages. This project goes deeper, into firms, contracts, archives, and products, to show how the economic gap was created, how it widened, and why it has endured.

The research rests on an unusually rich combination of archival and modern microdata. Its strength does not come from any single dataset. It comes from the ability to connect three difficult-to-access layers of evidence across time: the statistical records of the former GDR, the privatization archives of the Treuhandanstalt, and post-reunification firm and product data from unified Germany.

That combination is what makes the work possible. It lets the project move past national averages and measure mechanisms, not only outcomes, at the level where economic transformation actually happened. Plants, firms, contracts, products, audits, prices, and ownership structures become visible. The three papers show how planning rules, contract enforcement, and innovation incentives translated into firm behavior, and they compare East Germany against West Germany, the United States, and Soviet Russia to distinguish what was specific to the GDR from broader differences between systems.

The German Federal Archives preserve both the inherited microdata of the former GDR and the administrative record of the Treuhandanstalt. That is the bridge between the planned economy and the privatization that followed.

Three Layers of Evidence

A data bridge across three regimes

Planning, privatization, and competition. Each layer was assembled from sources that are rarely used together, and in some cases were only recently accessible.

Layer I1975–1990

The Planned Economy

Used in the planned-economy paper, this layer is built from four statistical sources: a firm registry, an employment survey, a production survey, and plan accounting. Together they let the research measure job flows, productivity shocks, and the ratchet effect, the downward adjustment of plan targets after a firm over-fulfilled its quota. The paper then places East Germany alongside West Germany, the United States, and Soviet Russia, separating what was specific to the GDR from broader patterns of planned and market economies.

0%

of official GDR employment covered, 1975–1990

Declassified statistical registers, Bundesarchiv

Layer II1990–1994

Privatization

Used in the employment-commitments paper, the Treuhand contract archive records firm identifiers, committed employment levels, deadlines, audit dates, and enforcement outcomes. It was transferred through cooperation with the Bundesarchiv. Linking the archive to post-privatization firm and employer-employee data lets the research identify how contracts actually shaped employment growth, exit, and productivity, moving from the administrative record of privatization to its measurable causal effects on firm behavior.

0

labor-commitment contracts, audited on average 6.3 times

Treuhand ISUD, IWH–Bundesarchiv cooperation

Layer III1995–2017

The Unified Market

Used in the convergence paper, this layer draws on two panels from the German statistical offices: a firm-level cost structure survey with sales, wages, subsidies, and R&D effort, and a firm-product panel with annual sales and quantities for thousands of narrowly defined products. Because both values and volumes are recorded, the research can construct product prices and compare East and West producers within the same categories, making persistent quality and technology gaps visible at a resolution that aggregate data cannot reach.

~0

nine-digit product codes observed across the panel

Cost structure survey and manufacturing product survey

Taken together, the three layers create a rare empirical pipeline across time. Before reunification, the GDR records reveal how labor, production, and planning were organized. During the transition, the Treuhand archive shows how firms were privatized, monitored, and disciplined through contracts and audits. After reunification, firm, product, and ownership data reveal how competition, innovation, and convergence evolved in the unified economy.

The power of the project lies in linkage, not in any single dataset.

Paper 1 · Employment Commitments

Interactive Data Explorer

Regression results from the employment-commitment study, across 7,845 firm-year observations drawn from the Treuhand contract archive. Filter by outcome variable and estimation method to see how commitments shaped employment, exit, and productivity after privatization.

Employment Growth(pp annual growth)

Each 10% increase in binding intensity raises annual employment growth by 1.3 pp (OLS) to 2.5 pp (IV).

SpecificationControlsCoefficientStd. ErrorSig.NR² / F-stat
OLS (1)None0.131(0.018)***7,8450.04
OLS (2)Industry FE0.128(0.018)***7,8450.07
OLS (3)Industry + Region FE0.134(0.019)***7,8450.08
IV (1)None0.248(0.062)***7,84518.3
IV (2)Industry FE0.251(0.064)***7,84516.7
IV (3)Industry + Region FE0.256(0.068)***7,84511.4

Source: Paper 1, Tables 3-5. Binding coefficient (committed employment ÷ initial size). Instrument: privatizer leniency.

The Research

Our papers

Each data layer in this project supports one of these papers.

Paper 1

Committing to GrowEmployment Targets and Firm Dynamics

Ufuk Akcigit (University of Chicago, IWH), Harun Alp (Federal Reserve Board), André Diegmann (IWH, IAB, ZEW), Nicolas Serrano-Velarde (Bocconi University, IGIER)

JEL · D22, D24, J08, L25

Keywords · industrial policy, productivity, size-dependent regulations, privatizations

Paper 2

Battle of IdeologiesFirm Dynamics and Productivity in Planned Versus Market Economies

Ufuk Akcigit (University of Chicago, NBER, CEPR, IWH), Richard Bräuer (Leibniz Institute for East and Southeast European Studies), Andrei Markevich (University of Helsinki, New Economic School, CEPR), Javier Miranda (IWH, Friedrich-Schiller University, CompNet), Anna Zherdeva (IWH)

JEL · D22, D24, L11, O47, P23

Keywords · creative destruction, planned economies, firm dynamics, productivity growth

Paper 3

Technology Gaps, Competition, and Regional Convergence

Ufuk Akcigit (University of Chicago, NBER, CEPR, IWH), Sina T. Ates (Federal Reserve Board), Furkan Kilic (University of Chicago), Matthias Mertens (MIT, IWH), Steffen Mueller (IWH, CESifo, IZA, Magdeburg University)

Keywords · convergence, technology frontier, product quality, ownership, subsidies