Why are some Cities Winners or Losers? / Aus der Reihe: e-fellows.net stipendiaten-wissen Bd.Band 1078 (PDF)

Bachelor Thesis from the year 2014 in the subject Business economics - Business Management, Corporate Governance, grade: 1,4, EBS European Business School gGmbH (Real Estate Management Institute), language: English, abstract: The aim of this bachelor thesis is to find out what drives city growth in
Germany. It shall find out what are the determinants that make large cities gain or lose
inhabitants.
Especially in Eastern Germany after the reunification there have been some
"winner cities" such as Dresden, Leipzig, and Potsdam, and many "loser cities" such as
Chemnitz, Magdeburg, and Schwerin. In the last decades, a similar separation between
winners and losers has arisen also in Western Germany. So what is the reason for this
division into two groups of cities?
The research is very relevant for city governments and real estate owners or
investors. Emigration of the working populace and few births lower the tax earnings and
raise the necessary public expenses a city has to bear, while the opposite makes a city
thrive fiscally, financially, and economically. Rents and land prices depend on the
development of the city size: shrinking cities have horrendous vacancy rates, while
prices are exploding in growing cities. Knowing what the reasons for city growth shrinkage are enables city governors to adapt the right policies to make their city
become an exception of the overall demographic collapse in Germany or to turn around
a dangerous progress. Knowing these reasons also enables real estate investors to
predict future demand for residential, office, and retail space, and to decide whether
properties are under or overpriced.