17 Jul describe the differences in the East German and West German economies prior to reunification.
In Chapter 9, the authors describe the differences in the East German and West German economies prior to reunification. One key difference was found in the quality of goods produced by Eastern and Western producers. The authors argue that the West German firms had access to high-income consumers in competitive market economies, so they had to produce higher quality and higher value goods. In contrast, the East German firms were producing for a poorer group of consumers in planned socialist systems, so they did not have to meet the same competitive market forces.
For example, the early iPhones produced by Apple were very innovative, and they improved over time in response to competition from Samsung and other smart phone producers. Can you provide another example of a product or service that has improved over time due to competitive forces? Also, please explain how has it improved.
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