Volume 216, Issue 3

This paper examines the education policy of the GDR state party SED in the field of statistics particularly for students of economics. Statistics was expected to be an instrument of party propaganda. What they called socialist statistics was created on the base of the ideas of Marx, Lenin and Stalin. The personnel policy of the Ministry of Higher Education had to serve these purposes, i.e. only active party members had a chance of getting a professor’s job. However, a remarkable proportion of the academic staff did a good teaching and research work ignoring the official party programmes.

Since about 1890 there have been private activities to change the image of the small town ILMENAU to a place of higher education. This paper describes the development of the present academic institution, beginning with the foundation of a non-state Polytechnic in 1894. Though originally guided by an educational concept of merely natural sciences, it is shown that from the very beginning there were economic teaching subjects, too. Nowadays, the university is conducted according to the budgets of ministry-administration by the BUNDESLAND THÜRINGEN with its own faculty of economics.

This paper investigates the welfare effects of the implementation of factor mobility in a Customs Union which means the foundation of a Common Market. Trade in goods as well as in factors induce positive and negative trade-creation and trade-diversion effects which are graphically identified as reallocation, capital-diversion and volume-of-trade effects. It is not possible to rule out the probability of a negative welfare impact of the Common Market.

The experimental evidence gathered in this study indicates that a preference for domestic investments exists even under fixed exchange rates and in the absence of factors commonly understood to give rise to asymmetric portfolios. Adding exchange rate risk does not - contrary to theory - induce many individuals to hold more domestic assets. Non-professional investors in particular are prone to make choices at variance with the normative theory. This is traced back to misjudgments concerning the available risk-return trade-offs. It is also documented that flexibility of the exchange rate induces economic losses through inefficient portfolio choice. This even holds in a situation where exchange rate risk can be avoided by costless hedging. Zusammenfassung Experimentell gewonnene Daten weisen darauf hin, daß eine Präferenz für inländische Vermögensanlagen auch bei fixen Wechselkursen und in Abwesenheit bekannter Faktoren für asymmetrische Portefeuilles vorkommt. Wechselkursrisiko bewegt nur eine Minderzahl der Probanden dazu, mehr Inlandanlagen zu halten. Dieses Verhalten ist nicht mit rational optimierendem Verhalten vereinbar. Es kommt - vor allem unter nicht-professionellen Anlegern - zustande, weil die vorliegenden Risiko-Ertrag Tradeoffs falsch eingeschätzt werden. Der Aufsatz dokumentiert zudem, daß Flexibilität des Wechselkurses zu einem Effizienzverlust führt. Dies gilt selbst, wenn das Wechselkursrisiko kostenlos abgesichert werden kann.