Public investments in education And energy transition impacts on Cee/ German Transformation.

1 Energy transition - Energiewende: the transition of Germany and several other countries to sustainable economies by means of renewable energy, energy efficiency and sustainable development. The final goal is the abolishment of coal and other non-renewable energy sources.

2 Legislative support was passed in 2011. Important aspects include: greenhouse gas reductions: 80–95% reduction by 2050, renewable energy targets: 60% share by 2050, energy efficiency: electricity efficiency up by 50% by 2050 and associated research and development drive. For solar investments and Central Germany see http://www.solarvalley.org/ 3 “…global financial crisis and economic recession of 2008-2009, followed by the euro sovereign debt crisis of 2011 have constrained debt provision worldwide. Financing conditions have become more difficult in most countries, as European banks experienced sharp increases in their cost of funding and investors remain in a risk-averse position….While sovereign interest rates are at historic lows, risk and liquidity premiums are at or near historic highs, which means that – together with a number of reforms after the financial crisis (Basel III, Solvency II) – long-tenor bank lending for all forms of infrastructure has dried up. It may be replaced by bond markets, sovereign wealth funds and institutional investors (insurance companies and pension f nds), but that is not certain and will take time. The financial crisis also led to a strong increase in global commodity prices, including the price of raw materials for biofuels and biomass energy production”. IRENA report 2012,. P.17.

4 See „Development, equity and policy - economic and financial Crisis“ (Univ. Göttingen/ HS Merseburg, 29.6.-2.7.2011) http://www.isces.net.

5 Financial and Economic Analysis of infrastructure/public projects in enlarged European Union, e.g EU Structural Funds, European Investment Bank: Cost benefit analysis of public investments, http://www.worldbank.org/oed/education/documents/education_primary_rationale_paper.pdf 6 For Public Investment in Higher Education and Ushering Our Campuses Into 21st Century European University Association has called on the continent's governments to commit to major investment in higher education and research, and to renew efforts to reach the Barcelona target of 3% of GDP investment in research and the 2% investment in higher education proposed by the European Commission.

7 A. Sen (1999) argued that Europe, North America, Japan, and East Asia benefited from the public provision and finance of widespread primary education. Many economists appeal to the experience of European countries during their phases of rapid growth during the 19th century as evidence for the contribution of education to economic growth. But direct steering mechanisms, and regulations as well as unbalanced accountability procedures which the EUA believes will be counterproductive in making universities an essential player in overcoming the crisis.

http://www.universityworldnews.com/article.php?story=20100528184210310. Finland, Sweden and Denmark have all started to introduce tuition fees at least for some offered programmes and/or will charge tuition to foreign students.

8 See contributions to social philosophy/ political economy James Buchanan- introduced ethics, legal political thinking, and social thinking into economics: Public choice analysis, etc..

9 • Market /Competitive Analysis: framework, market trends, market growth • SWOT analysis: clarity specific strengths and weaknesses as well as market and environment side Opportunities and Risks of projects.

• Feasibility studies and Business Planning: Derivation realization of a suitable approach economic analysis. Investment viability in rated: • Comparison and Review the realization concept -investment calculation methods • Expense and revenue forecasts, Investment and human resources planning • profitability calculation and sensitivity analysis • Cost-benefit analysis: determination by (Detour) profitabilities of infrastructure projects or social returns (SROI), for publicly funded project.

Term grew in popularity, applied increasing generality to suggest the internal framework discernible in any technology: Also analyzing impacts of investment on capital requirements and determining budget and ideal financing: • Cash flow forecast: liquidity and viability of the project • Capital Needs Analysis: Determination the necessary capital investment • Financial analysis: determination and assessment of funding options and optimal Financing mix (including PPP10 testing) Regional Economic Analysis: Consideration of public investment on commercial view beyond.

quantify and evaluate effects of investment project for Business location and underpin economic arguments: • Identification of regional economic effective channels of investment • Quantifying the effects regarding employment effects and regional value added, Purchasing power and fiscal returns.

Analysis of contents and stakeholders, development of communication strategies to implementation of an active dialogue process. Political communication: • Decision-Oriented Processing planning results • Develop strategies and communication concepts • formulation of targeted argumentations • facilitation of planning and dialogue process.

Benefit-Co st Analysis: Its Relevance to Public Investment Decisions Discount Rates for Public Investment under Uncertainty.

Public investments in education and energy transition impacts on CEE/German transformation Prof. Eckhard Freyer Revue des Sciences Économiques et de Gestion N°12 (2012)16 11 Human Development Index (HDI) is a comparative measure for countries worldwide. It is a standar measure the impact of economic policies on quality of life. HDI measures the average achievements in a country in three basic dimensions of human development: a long and healthy life, as measured by life expectancy at birth; knowledge, as measured by the adult literacy rate (with two-thirds weight) and the combined primary, secondary, and tertiary gross enrollment ratio (with one-third weight); and a decent standard of living, as measured by the log of gross domestic product (GDP) per capita at purchasing power parity (PPP) in USD.

12 Gunnar Myrdal (6 December 1898 – 17 May 1987) pioneering work in the theory of money and economic fluctuations and for their penetrating analysis of the interdependence of economic, social and institutional phenomena." 13 China was able to exploit its potential as one of the world’s major exporters and HDI has risen. The United Nations Conference on Trade and Development (UNCTAD, see web) was established for problems relating to the economic development. Can the Asian miracle be explained in terms of capital investments? Public Investments in infrastructure, see WEF’s Global Competitiveness Report show contributions of education and railroads. Actual discussions also consider environmental aspects; also an end of the Asian Miracle, based on cheap labour: now workforce development is a global economic development approach. see Paul Krugman (1994): “The myth of Asia’s miracle”, Foreign Affairs. and World Bank(2006): “An East Asian Renaissance. Ideas for Economic Growth”, IBRD .

14 Per capita Gross Domestic Product (GDP per head) is used by many developmental economists as an approximation of general national well-being. However, these measures are criticized as not measuring economic growth well enough, especially in countries where there is much economic activity that is not part of measured financial transactions (such as housekeeping and self-homebuilding), or where funding is not available for accurate measurements to be made publicly available for other economists to use in their studies (including private and institutional fraud, in some countries). recent theories of Human Development have begun to see beyond purely financial measures of development, for example with measures such as medical care available, education, equality, and political freedom.

Eckhard Freyer: Finanzkrise in Rußland, in: Evangelische Kommentare 11/1998, S. 653-655, Zur Wirtschafts- und Finanzkrise einer Großmacht, in: Das Parlament, Nr. 49, 27.11.1998, S. 16. European Financial Integration, Transformation in CEE and Accession of Cyprus, Nicosia 1998, p. 67 – 88. EU Economic and Political Cohesion after Enlargement, in: EU- Enlarfgement…, Nicosia 2004. p. 57-66.

16 Before founded 1949 GDR and construction of the Wall in 1961 3.3 million people, well-trained professionals, left. While the industry in the 1950s, yet innovations such as the "Trabant" and brought forth to the state invested in the 1960s in new facilities, the innovative power soon fell sharply due its economy no need to prove in competition. In addition, DDR researchers lacked contact with their Western counterparts. When the GDR in 1990 was again exposed to international competition, a misery technology standstill. Three decades industry had to be built from scratch, which is still not completed today. It lacks the big companies that produce in the West, most high-tech goods and promote their research to technical progress: 70 percent of the West German economic output per capita eastern states 20 years after the Wall fell.

17 Michael Jürgs: Die Treuhändler. Wie Helden und Halunken die DDR verkauften. München/Leipzig 1997, Siegfried Wenzel: Was war die DDR wert?, Berlin 2000; Mark Cassell, How Governments Privatize: the Politics of Divestment in the United States and Germany, Georgetown University Press, 2002. see Rupieper, Hermann J /Sattler, Friederike /Wagner-Kyora, Georg: Die mitteldeutsche Chemieindustrie und ihre Arbeiter im 20. Jahrhundert, Halle 2006, for case studies on Chemieregion Halle, centers in Merseburg and Bitterfeld/Wolfen .

18 For Public Investments in Tertiary Education /performance in German government “initiative for excellence“ see: Anger, Christina / Plünnecke, Axel, 2010, Droht durch den künftigen Akademikermangel eine Abnahme der Konvergenzchancen Ostdeutschlands? in: IW-Trends, 37.Jg., Heft 2, Köln, S. 1–17, Statistisches Bundesamt (Hrsg.), 2011, Bildung und Kultur: Finanzen der Hochschulen – 2009, Fachserie 11, Reihe 4.5, Wiesbaden 19 The supply of university graduates significantly affects regional growth prospects in Germany. As the society ages the number of young, highly skilled graduates needed to replace older employees will significantly increase. A forecast shows that without inter-regional migration the number of university graduates will lag behind the demand of a growing economy. The bottleneck will be particularly tight in Eastern Germany. Between 2015 and 2019 eight out of ten and between 2020 and 2024 nine out of ten graduates in the region will be needed to replace highly skilled workers who reach retirement age. In West Germany two out of three graduates will be needed filling the vacancies. New highways, renovated façades and a falling unemployment rate - these are the successes of the "Aufbau Ost". However, the economic performance in East Germany can compete with the far western levels. 20 years after the fall of the Berlin wall East Germany has caught up with the west in some aspects while still lagging in others. Its GDP per capita remains stuck at two thirds of the West German level and its unemployment rate is twice the West German rate 20 Government in Magdeburg accumulated primarily in the 1990s, high debt on the neck: In 2010, every inhabitant was statistically with more than 8,700 euros in debt - the average of all states per capita debt was however less than 7,300 euros.

21 Government Commission for monitoring energy revolution: reduce primary energy consumption by 2020 compared to 2008 as planned by 20 percent; calculation according to the efficiency in the coming years will be increased by 2.6 percent per year - so far there are only about 1.6 percent . Many researchers believe the most cost-effective option in developing renewable energies, wind energy on land - but this should be better coordinated with the network expansion. Climate change targets and sources of revenue to fund the energy revolution not to compromise, they remind us of a reform of the EU's emissions trading system by a sharp drop in prices for emission rights. http://www.faz.net/aktuell/politik/energiewende/ 22 German companies already control a third of the worldwide market for solar thermal energy. Wuppertal Institute for Climate, Environment and Energy calculated the projected revenues for German solar companies by the year 2050 under a best-case Public investments in education and energy transition impacts on CEE/German transformation Prof. Eckhard Freyer Revue des Sciences Économiques et de Gestion N°12 (2012)17 scenario, it came up with €2 trillion. As alternative emissions-free but cheaper energy: In the next 20 years, photovoltaics will cost German electricity customers an estimated €100 billion as a result of the country's Renewable Energy Act of 2000, which guarantees fixed prices for renewable electricity fed into the grid -- even though photovoltaics makes up only a little more than 1 percent of the German power supply.

23 On 01/03/2013: Sunpower sold 579-MW project in California for 2.5 billion dollars to the power company MidAmerican Energy= Warren Buffett's Berkshire Hathaway. Buffett again investing where no one else wants in trends, before purchased First Solar.

China built up for years an enormous solar industry, but hardly promoted and installed equipment is probably the world's largest market in 2013 over Germany : 2015, China > an increase to 40 GW envisaged. In USA 6 GW new capacity 2013= + 50 % /2012.

Excess capacity in global solar industry based on huge government subsidies expanding Chinese solar industry could not keep up with demand. But price decline has triggered photovoltaics because of bankruptcies and factory shutdowns.

24 The International Renewable Energy Agency (IRENA) is an intergovernmental organisation dedicated to renewable energy; objective is to “promote the widespread and increased adoption, and the sustainable use of all forms of renewable energy”. This concerns all forms of energy produced from renewable sources in a sustainable manner and includes bioenergy, geothermal energy, hydropower, ocean, solar and wind energy. As of December 2012, the membership of IRENA comprised 159 States and the European Union (EU). http://www.irena.org/adsw/index.aspx 25 Much of the literature on R&D is concerned with the question of whether public funding stimulates private R&D expenditure or whether it simply acts as a substitute for private financing. There are three mechanisms by which public funding can crowd out private investment. First, it is likely that the labour supply of scientists is quite inelastic, so that when the government provides a subsidy to R&D this may be spent on increased wages rather than new R&D, at least in the short run (Goolsbee, 1998). There may still be positive benefits from these subsidies from encouraging people to become scientists, or by increasing their effort at work by paying them higher salaries. Second, public funding could also simply replace private funding if business substituted public funding for their own funds. Third, public funding could distort resource allocation favouring areas with lower opportunities 26 A range of economic studies over a long period have recorded a range of benefits to the economy as a whole and to firms individually. Several studies have found academic research to be increasingly important for industrial innovation, accounting for 15 per cent of new products, 11 per cent of new processes and up to five percent of industry sales (Mansfield, 1991; Mansfield, 1998; Beise and Stahl, 1999). These figures capture only technological innovations based on academic research that has been carried out in the preceding 15 years.

Patent data also been used to identify the importance of public research for innovation (Narin et al., 1997). Evidence from Australia, for instance, found that 90 per cent of research papers cited in Australian- invented US patents were publicly funded. Studies of individual industries, in particular the pharmaceuticals industry, highlight the importance of public investment in science, with one study recording a 30 per cent return (Cockburn and Henderson, 2000; Toole, 2000). Gurdgiev (2006) uses data from the EU Commission report ‘Innovation Strengths and Weaknesses’ (2005) to plot public sector innovation drivers against economic growth for EU countries.

27 E.g. Student exchange system for the Mediterranean neighbors based on the European Erasmus model.

E.g.effects of public investments into higher education in CEE/ Germany´s Transformation and Unification process on development and growth.

1950 and 1967, California invested 22 percent of all state spending in public services and public infrastructure: once the model of public investment in its future, must admit that in its more recent history it has been the model of disinvestment ; democratic access to higher education promised in the United States by a series of legislative acts responding both to immediate economic needs and to far-sighted understanding of future priorities.

29 Public support can encourage private sector investments by addressing market failures associated with incomplete information, inappropriability of the benefits of privately funded research or lack of suitable finance for innovation. An OECD study (Guellec and Van Pottelsberghe, 2004) attempted to quantify the aggregate net effect of government funding on BERD in 17 OECD countries over the previous two decades. The study found: • Direct government funding of R&D performed by firms (either grants or procurement) has a positive effect on BERD (one dollar given to firms results in 1.70 dollars of research on average); The relationship between R&D and innovation is not a linear one. The outputs from science and technology activities depend not only on the amount of R&D input, but also on efficiency of the entire innovation system (OECD, 1999a). In order to optimise the efficiencyof this system it is vital that effective linkages are developed between its different components, which would facilitate the transfer of scientific knowledge. The Government has a key role to play in this area (OECD, 1999b). The most important support for Higher Education-industry collaboration under the NDP 2000-2006 was the RTDI for Collaboration Programme. The principal schemes supported under the programme were: Innovation Partnerships, which aimed to build R&D partnerships between industry and Third Level Institutions.

Public investments in education and energy transition impacts on CEE/German transformation Prof. Eckhard Freyer Revue des Sciences Économiques et de Gestion N°12 (2012)18 30 See: Financial Mechanisms and Investment Frameworks for Renewables in Developing Countries, IRENA Dec. 2012. also http://www.idced.com/ 31 Economic literature on extent of the returns from publicly funded research shows evidence that publicly funded research does make substantial positive contributions to productivity, human capital development and economic growth. The challenge is to organise the national research and innovation system in such a way as to maximise return on investment. The benefits that spill over from public and private research are becoming increasingly important, as knowledge, high-level skills and innovative capacity are key sources of competitive advantage. Evaluations of publicly funded research programmes concluded that progress has been impressive and funding must be continued in order to achieve sustained gains.

32 For this reason, the present master thesis considers the implementation of financial and controlling instruments from the representation of project progress of alternative power MÜKA GmbH for an example of a company in the field of renewable energy and its course more accurately explain project. what the different departments together and interdisciplinary project from all perspectives considered complete and correct. Finally can still make a judgment on biofuels. Therefore, this is a difficult work position. Base is that the alternative power MÜKA GmbH and Merseburg (FH) created a partnership.

Landwirtschaftliche Biokraftstoffe e.V. www.lab-biokraftstoffe.de, European Ethanol Fuel Association www.ebio.org, Mobil ohne Fossil www.mobil-ohne-fossil.de, Fachagentur Nachwachsende Rohstoffe www.fnr.de sowie die Thesen zur Energiezukunft für Deutschland http://www.energiezukunft-fuer-deutschland.info/index/confirm/key/be8b7dfe0108ce96d07f65becd98f74a, Bosch and VW developed the Total Flex engine: it can use any mixture of petrol and ethanol, 100 percent to 100 percent alcohol fuel.

33 A legendary conflict of fuel/energy versus food is avoided in Müka- model: A conflict/ dilemma regarding the risk of diverting farmland or biofuel-crops detriment of the food supply on a global scale. Ethical aspects of global development involve the cultural and social issues relating to the environment becomes more relevant.

34 http://www.enertec-leipzig.de/ A range of biogas energy and 3% of the electricity consumed in Germany are produced. http://www.dbu.de/ Verbio a leading manufacturers and suppliers of biofuels and also the only industrial- scale producer of biodiesel, bioethanol and biogas in Europe. Its nominal capacity is about 450,000 tons of biodiesel, 300,000 tons of bioethanol and 480 gigawatt hours of biomethane per year. The company continues to manufacture its highly efficient proprietary fuels, energy-saving production processes and innovative technologies. http://www.green-ventures.com/ 35 http://www.bdew.de/ A boom in the creative industry represents a result of this trend (design etc.). In some industries we can observe that formal businesses are not always necessary to provide products and services. Even in more classical service sectors like health care the final consumer becomes an important partner in the service provision process. http://www.bdi.de/ 36 An Energy Revolution in Africa The biogas backpack; Not only in rural areas, and in many African cities is today still cooked with wood or charcoal. Therefore, everything is kind of combustible, collected. Maps to see the radii that form around villages around, where there are already no wood and no more forest. But a very different energy source is much closer, namely in the stalls of cattle: the biogas. http://www.swr.de/swr2/wissen/biogas-in-afrika/- /id=661224/nid=661224/did=10850962/r37ewm/index.html 37 Creating education services in case studies we develop and present in a digital format online use of ecosystem as well as social system service as an element of the business model. As new Concepts of Small and Medium-sized Enterprise Promotion especially focusing on the development and the implementation of new concepts in SME promotion. provide an overview about the experiences of the last 20 years in SME promotion around the world. Furthermore we will discuss new trends in the field which are directly related

38 See Freyer, Eckhard: Die Kapitalbeteiligungsgesellschaft als Instrument der Wirtschaftspolitik. Frankfurt/M. 1981, ISBN 3- 87144-638-6 , Islamic and Western Investment Companies - An Empirical Comparative Study. In: Economics, Vol. 37 (1988), p. 52- 89, Les sociétés de participation islamiques et occidentales. In: G. Beaugé: Les capitaux de l`Islam, CNRS 1990, S. 201 - 220 .

39 Given the price of energy massively in renewable energy and new technologies are being invested: Perspectives and visions appear in the work. Generally it is very difficult to give predictions, because the companies involved many details to keep secret. It is a broad field for research, since all of the departments is addressed to combine technical, social and economic aspects.

Globalization requires complex life-stiles; flexible processes, self-responsibility, work-life balance, social networks and integration. What matters is what people can achieve with their goods, and not what the individual actually has. The "capability" (ability) core concept was in Sens work, it is supplemented by "functionings," the values of a people, such as food, income, self-esteem and the active involvement in the community. See Amartya Sen (1985): "Commodities and Capabilities" and www.undp.org/info21; www.globalknowledge.org; www.kcenter.com; www.iicd.org;