multinational giants such as Siemens and General Motors, have set up shop there as well. In 1998, the eastern states were home to 520,000 small and medium-sized businesses, most of them founded since unification, with a total of 3.2 million employees on their payrolls. The number of self-employed easterners has also grown rapidly, jumping from 30,000 shortly before unification to 240,000 in 1998. This flourishing and steadily expanding private sector testifies to the scale of the economic change that has occurred in eastern Germany since unification. The full extent of this change is often overlooked, though: eastern Germany's economic progress is invariably measured against by how close it has come to matching western German performance levels rather than how far it put centralized planning and COMECON-focused trade behind it. Financial, technical and legal assistance from the western German states have helped eastern Germany make a more rapid and arguably less disruptive transition to the free market than the other onetime Warsaw Pact member states. Nor, it should be added, do economic comparisons between eastern and western Germany tilt so lopsidedly in the west's favor as they did at the time of political unification. Eastern worker productivity and wages stood at roughly a third of the western average in 1990. Both the productivity and wage gaps have narrowed considerably in most professions and branches of industry . Three independent research institutes - the German Institute for Economic Research (Berlin) , the Institute of International Economics (Kiel) and the Halle Institute for Economic Research - reported in the summer of 1998, for example, that worker productivity in eastern Germany's manufacturing sector. has improved markedly, more than doubling between 1991 and 1997. But even with that gain, the institutes noted, output per w...
