Why are some Cities Winners or Losers?

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.