Benz, Lena; Block, Jö n; Johann, Ma hias
A icle
Hidden champions as a de e minan o egional
de elopmen : An analysis o Ge man dis ic s
ZFW - Ad ances in Economic Geog aphy
P o ided in Coope a ion wi h:
De G uy e B ill
Sugges ed Ci a ion: Benz, Lena; Block, Jö n; Johann, Ma hias (2024) : Hidden champions as a
de e minan o egional de elopmen : An analysis o Ge man dis ic s, ZFW - Ad ances in Economic
Geog aphy, ISSN 2748-1964, De G uy e , Be lin, Vol. 68, Iss. 1, pp. 9-39,
h ps://doi.o g/10.1515/z w-2020-0043
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ZFW – Ad ances in Economic Geog aphy 2024; 68(1): 9–39
Lena Benz*, Jö n H. Block, Ma hias S. Johann
Hidden champions as a de e minan o egional
de elopmen : An analysis o ge man dis ic s
h ps://doi.o g/10.1515/z w-2020-0043
Recei ed Decembe 2, 2020; accep ed Augus 20, 2021
published online Sep embe 8, 2021
Abs ac : Hidden Champions (HCs) a e de ined as ma ke
leade s in niche ma ke s. They ep esen he success
o he Ge man Mi els and like no o he g oup o i ms.
Howe e , li le is known on how HCs con ibu e o egi-
onal de elopmen . Gi en hei expo s eng h, egional
embeddedness, and s ong e ical in eg a ion we expec
HCs o ha e a p o ound e ec on egional de elopmen .
Using a Ge man da ase o 1,645 HCs loca ed in 401
Ge man dis ic s, we analyze he e ec o HCs on a a ie y
o egional de elopmen dimensions. Ou esul s show
ha HCs a e no equally dis ibu ed ac oss egions and
in luence egional de elopmen . Regions wi h a highe
numbe o HCs show s ong egional economic pe o -
mance in e ms o median income. Mo eo e , HC in ensi y
a ec s egional unemploymen and ainee a es as well
as egional inno a ion in e ms o pa en s. Su p isingly,
we did no ind an e ec o egional HC in ensi y on egi-
onal R&D le els and GDP. We can u he conclude ha
he e ec o HCs is no limi ed o he pa icula egion in
which hey a e loca ed bu ha sizable spillo e e ec s
exis . Besides i s con ibu ion o he egional de elop-
men li e a u e, ou s udy adds o a be e unde s anding
o he HC-phenomenon. Implica ions o egional policy
make s a e discussed.
Keywo ds: Ge many; hidden champions; inno a ion; Mi -
els and; egional de elopmen ; egional pe o mance
1 In oduc ion
De ined as (wo ld) ma ke leade s in a niche ma ke ,
hidden champions (HCs) a e a success ul subg oup o he
Ge man Mi els and. Disco e ed as a phenomenon in he
1990s by He mann Simon, he concep o he HC is now
widesp ead. Though HCs pa ly o e lap wi h he Ge man
Mi els and, comp ising many amily businesses, he
hidden (wo ld) ma ke leade s clea ly s and ou as hey
possess dis inc cha ac e is ics. Thei o mula o success
includes, among o he hings, he combina ion o a niche
ma ke ocus and in ense in e na ionaliza ion as well
as supe io echnological capabili ies and a specialized
wo k o ce (e. g. Aud e sch e al. 2018; Ramme /Spielkamp
2015, 2019; Simon 2012).
HCs and he Ge man Mi els and in gene al make con-
side able con ibu ions o he pe o mance o he Ge man
economy and i s s a us as a dominan expo na ion. In a
coun y compa ison s udy, Aud e sch e al. (2020) iden i y
Ge many as he na ion wi h he la ges numbe o wo ld
ma ke leade s pe capi a, which migh be one eason o
he success o he Ge man economy. In addi ion o hei
impo ance a he na ional le el, he impac o HCs on he
egional economy is undeniable. Indeed, egional s udies
ha e examined ela ed i m ypes such as amily i ms o
membe s o he Ge man Mi els and in gene al and ha e
ound e idence o an impac on di e en egional de el-
opmen dimensions (e. g. S ough e al. 2015). Fo ins ance,
p e ious s udies analyzed he impac o hese i m ypes
on egional inno a i eness (Be lemann/Jahn 2016; Block/
Spiegel 2013), egional economic g ow h (Memili e al.
2015) and egional esou ces such as human esou ces
(Basco 2015).
Al hough he h ee g oups pa ly o e lap, consid-
e able di e ences exis , which a e c ucial o a sepa a e
analysis o HCs a he egional le el. HCs a e, o example,
de ined by ma ke leade ship in a niche ma ke (Simon
2012) and no by i m owne ship as amily i ms. An anal-
ysis o he egional impac o HCs p o ides he oppo uni y
o gain deepe insigh s in o he HC phenomenon, which
is especially in e es ing om a policy pe spec i e a he
egional le el. HCs make conside able con ibu ions o he
pe o mance o he Ge man economy (e. g. Lehmann e al.
2019) and hey ep esen majo employe s (e. g. Pahnke/
*Co esponding au ho : Lena Benz, Uni e si y o T ie , Uni e si ä s-
ing 15, 54296 T ie , Ge many, E-Mail: benz@uni- ie .de,
ORCID 0000-0002-0952-130X
Jö n H. Block, Uni e si y o T ie , Uni e si ä s ing 15, 54296 T ie ,
Ge many, Wi en Ins i u e o Family Business, Al ed-He hausen-
S aße50, 58455 Wi en, Ge many, E asmus School o Economics,
Bu gemees e Oudlaan 50, 3062 PA Ro e dam, he Ne he lands,
E-Mail: block@uni- ie .de, ORCID 0000-0003-4564-0346
Ma hias S. Johann, Uni e si y o T ie , Uni e si ä s ing 15,
54296 T ie , Ge many, E-Mail: johann@uni- ie .de,
ORCID 0000-0001-5436-4246
Open Access. © 2024 Rie mann, published by De G uy e . This wo k is licensed unde he C ea i e Commons A ibu ion 4.0 In e na ional
License.
10 L. Benz e al.: Hidden champions as a de e minan o egional de elopmen
Wel e 2019). Also, HCs a e egionally connec ed and no
only loca ed in agglome a ed bu also pe iphe al a eas
(e. g. Aud e sch e al. 2008; Lang e al. 2019). Due o he
di e en cha ac e is ics o HCs, i is impo an o lea n
abou hei in luence a he dis ic le el and unco e how
hey a ec egional de elopmen dimensions such as pe -
o mance o employmen . Acco dingly, HCs can a ac he
a en ion o policy make s and hus ecei e mo e suppo
o he u he de elopmen o he egions in which hey
a e loca ed. These conside a ions lead o he ollowing
esea ch ques ion: Wha impac does egional HC in en-
si y ha e on egional de elopmen ?
To answe his esea ch ques ion, we combine a
da ase co e ing 1,645 Ge man HCs wi h a da ase co -
e ing he 401 Ge man dis ic s. The o me se es as he
basis o ou independen a iable HC in ensi y. The la e
consis s o da a on egional de elopmen dimensions and
egional-le el con ol a iables. A e combining bo h
da ase s, he inal da ase wi h 401 obse a ions eme ges,
ep esen ing he 401 Ge man dis ic s. Conduc ing linea
eg ession analyses, we examine he in luence o HC
in ensi y on a wide ange o egional de elopmen dimen-
sions, i. e., egional economic pe o mance, employmen ,
and inno a ion, o ob ain comp ehensi e insigh s in o
how egional HC in ensi y a ec s egional de elopmen .
The indings show ha HC in ensi y signi ican ly
in luences each o he egional de elopmen dimensions
examined in ou s udy. We ind only pa ial suppo o
he an icipa ed e ec s on he dimensions o egional eco-
nomic pe o mance and egional inno a ion, showing ha
HC in ensi y signi ican ly a ec s hese wo dimensions
only o a limi ed ex en . In e ms o egional employmen ,
we ind a signi ican in luence o HC in ensi y on bo h a -
iables cap u ing his egional de elopmen dimension,
ully suppo ing he expec ed ela ionships. These esul s
ha e o be conside ed in ligh o po en ial e e se causali y
which is a common limi a ion o geog aphic s udies ha
a e unable o use his o ical da a. In ou case, we lack pas
in o ma ion on he HC da ase .
Consequen ly, ou s udy con ibu es o he small and
eme ging s eam o HC li e a u e, which has been a he
scan so a , wi h ew scien i ically published academic
s udies (e. g. Aud e sch e al. 2018, 2020; Johann e al. 2021;
Lehmann e al. 2019). Ou indings con ibu e o a be e
unde s anding o HC unc ionali y by looking a how hese
i ms a ec se e al egional de elopmen dimensions.
Hence, we unco e he impac o HCs on economic pe o -
mance, employmen , and inno a ion a he egional le el,
highligh ing he key ole o his g oup o i ms in he dis ic s
in which hey a e loca ed. By examining HCs on a egional
le el, we also con ibu e o he li e a u e on de e minan s
o egional de elopmen (e. g. Block/Spiegel 2013; F i sch/
Mülle 2008; Vonnahme/Lang 2019), showing ha HCs a e
an in luen ial g oup o ac o s in he egional economy. Sub-
sequen ly, hese indings also ha e p ac ical implica ions,
especially o policy make s a he egional le el.
This a icle is s uc u ed as ollows: Sec ion 2 p o ides
deepe insigh s in o he phenomenon o HCs, ollowed
by an o e iew o he li e a u e on he de e minan s and
dimensions o egional de elopmen . Sec ion 3 con ains
he de i a ion o hypo heses on he impac o HC in ensi y
on selec ed egional de elopmen dimensions. The da a
and me hodology o he s udy a e explained in sec ion 4,
u he in oducing he a iables included in ou exami-
na ions. Sec ion 5 p esen s he desc ip i e and mul i a -
ia e analyses conduc ed, as well as a se ies o obus ness
checks and pos hoc analyses. Finally, we discuss ou
indings in sec ion 6, e eal he implica ions and limi a-
ions o he s udy, and highligh a ising a enues o u u e
esea ch.
2 Li e a u e e iew
2.1 The hidden champions phenomenon
HCs ep esen a pa icula ly success ul subg oup o medi-
um-sized i ms. Simon i s disco e ed he HC phenome-
non in he 1990s. The ollowing concep ual unde s and-
ings o HCs he e o e o igina e om Simon (1996, 2012,
2013), who de ines HCs acco ding o h ee c i e ia. Fi s ,
HCs a e among he op h ee ma ke -leading i ms in he
global ma ke o a e numbe one in hei domes ic con i-
nen . Second, HCs ea n e enues below i e billion eu os,
and hi d, hey a e ela i ely unknown o he public. While
ma ke sha e and e enue a e quan i a i e and egula ly
u ilized c i e ia o iden i ying HCs, academic s udies
ypically do no ope a ionalize he quali a i e c i e ion o
public awa eness (e. g. Ramme /Spielkamp 2015, 2019).
As he de ini ion indica es, HCs p ima ily pu sue he wo
syne gis ic goals o ma ke leade ship and g ow h. On he
one hand, HCs s i e o ma ke leade ship in quan i a i e
e ms in he o m o ma ke sha e, as well as in quali a i e
e ms in he o m o leade ship o e ma ke pa icipan s
by se ing s anda ds o being pionee s. On he o he hand,
HCs s i e o con inuous g ow h. Nume ous examples o
o me HCs ha became majo in e na ional en e p ises
lis ed on he s ock exchange (e. g. SAP and F esenius
Medical Ca e) demons a e his. To achie e hei goals,
HCs ollow a s a egy ha combines wo pa adigms ha
ini ially appea o be con adic o y. HCs s ic ly ocus on
L. Benz e al.: Hidden champions as a de e minan o egional de elopmen 11
niche ma ke s whe e hey se e selec ed cus ome s wi h
high-quali y p oduc s. Ne e heless, while hei ocus on
a selec ed niche makes hei ma ke small, in e na ional
expansion gi es hem he necessa y size o ope a e p o i -
ably. The e o e, HCs sell specialized p oduc s on a global
scale (e. g. Aud e sch e al. 2018; Voudou is e al. 2000).
Consequen ly, he HC phenomenon ela es o he
s a egy li e a u e. Acco ding o Po e (1980), i ms s i e
o compe i i e ad an ages h ough he pu sui o one
o h ee gene ic compe i i e s a egies: cos leade ship,
p oduc di e en ia ion, o ocus. While he achie emen
o compe i i e ad an ages h ough cos leade ship e e s
o p oduc s anda diza ion, mass-ma ke se ice, and he
educ ion o ixed cos s, p oduc di e en ia ion a emp s
o achie e a compe i i e ad an age by o e ing high-qual-
i y p oduc s and exploi ing cus ome s’ inc eased willing-
ness o pay o such p oduc s. The ocus s a egy ep e-
sen s a a ia ion on p oduc di e en ia ion, as i aims
o o e high-quali y p oduc s speci ically ailo ed o he
needs o selec ed cus ome s in a de ined ma ke segmen .
Hence, i ms pu suing a ocus s a egy ope a e in niche
ma ke s (e. g. Aud e sch e al. 2018; To en/Hamme oll
2009, 2010a, 2010b). In gene al, a niche ma ke is a na -
owly de ined ma ke ha ypically consis s o only one
cus ome o a compa a i ely small g oup o cus ome s
wi h simila needs (Dalgic/Leeuw 1994). Acco dingly, a
niche ma ke s a egy desc ibes a i m’s concen a ion on
ce ain cus ome needs, p oduc segmen s, o geog aphi-
cally o demog aphically de ined ma ke s (Teplensky e al.
1993; To en/Hamme oll 2010a, 2010b). Fi ms ollowing a
niche ma ke s a egy posi ion hemsel es in small, p o -
i able, and homogeneous ma ke segmen s ha a e no
occupied by compe i o s (Dalgic/Leeuw 1994).
Re iewing p io esea ch, To en & Hamme oll
(2009, 2010b) iden i y se en in e ela ed cha ac e is ics
o i ms ope a ing in niche ma ke s. These cha ac e is ics
con ibu e o he success ul implemen a ion o a niche
ma ke s a egy and hus co espond o he HC s a egy.
Fi s , niche i ms hink and ac small (Hame mesh e al.
1978) as hey o e , o example, compa a i ely small p o-
duc ion olumes, concen a e only on selec ed cus ome s,
and delibe a ely choose ma ke s in which ew compe i-
o s ope a e (Heza e al. 2006). Al hough HCs ope a e in
na owly de ined ma ke s and p oduce small olumes o
hei na ional cus ome s, hei p oduc ion olumes g ow
due o hei in e na ional expansion. Second, niche i ms
consciously selec ma ke s based on hei own s eng hs
and compe encies (Hame mesh e al. 1978), en e ing in o
only hose niches whe e hey a e able o con ibu e alu-
able p oduc s due o speci ic skills and in-dep h knowl-
edge. Consis en wi h his s a egy, HCs a e specialis s
wi hin hei indus ies. To main ain a ma ke -leading
posi ion, hey manu ac u e echnologically ad anced
p oduc s and posi ion hemsel es as quali y leade s. Con-
sequen ly, HCs equi e p o ound expe ise, which hey
ha e acqui ed mainly due o hei quali ied wo k o ce and
ex ensi e inno a ion ac i i ies (e. g. Lehmann e al. 2019;
Ramme /Spielkamp 2015, 2019; Schenkenho e 2020).
Thi d, niche i ms s and ou by applying specializa ion
and di e en ia ion, ypically wi h e e ence o p oduc s
and cus ome s (e. g. Aud e sch e al. 2018, 2020; Dalgic/
Leeuw 1994; Ko le 1997). In line wi h his, HCs ocus on
he indi idual demands o a limi ed cus ome base o
whom hey p o ide a co espondingly de ined p oduc
segmen . Mo eo e , hey no only manu ac u e quali y
p oduc s bu also o e a deep ange o se ices wi hin
na owly de ined ma ke s. To p o ide dep h in alue c e-
a ion, HCs ypically ha e hei own p oduc ion acili ies
and inno a ion labs (Ramme /Spielkamp 2015, 2019).
Fou h, hey a e subsequen ly able o co e se e al s ages
o hei cus ome s’ alue chain, di ec ly aligning hei
specialized compe encies and esou ces wi h hei cus-
ome s’ needs. Hence, HCs ailo hei p oduc s p ecisely
o cus ome -speci ic demands and se a s ong ocus on
cus ome needs (Dalgic/Leeuw 1994). Fi h, niche i ms
a ach g ea impo ance o hei epu a ion and use wo d-
o -mou h e e ences o expand (Dalgic/Leeuw 1994). Since
HCs ypically ope a e in B2B ma ke s, hey a e li le known
o end-p oduc consume s. Because HCs a oid ex ensi e
ma ke ing ac i i ies, a s ong epu a ion unc ions as a
p e equisi e o success ul business ela ions. Apa om
his, HCs p ac ice a s ong alue sys em based on conse -
a i e p inciples such as us and loyal y, guiding bo h
hei in e nal and ex e nal ela ionships. Six h, HCs con-
sequen ly build s ong long- e m ela ionships wi h el-
e an s akeholde s (Dalgic/Leeuw 1994; Voudou is e al.
2000). In addi ion o close ela ionships wi h employees,
HCs main ain igh cus ome ela ions (e. g. Aud e sch e
al. 2018). Cus ome p oximi y o ms hei g ea es s eng h
and is, due o in e na ional expansion, ac i ely p ac iced
ac oss na ional bo de s. Because complex, cus omized
p oduc s equi e egula cus ome con ac , HCs en e
o eign ma ke s a an ea ly s age, ely on di ec sales,
and es ablish hei own subsidia ies ab oad. Fu he -
mo e, HCs ca y ou inno a ion ac i i ies in close consul-
a ion wi h hei cus ome s, and e en op managemen
main ains egula con ac wi h cus ome s (e. g. Ramme /
Spielkamp 2015, 2019). Se en h, niche i ms cha ge a p ice
p emium, as hey a e able o o e supe io cus ome alue
(e. g. Dalgic/Leeuw 1994; Ko le 1997). Since HCs p o ide
highly specialized p oduc s wi h s a e-o - he-a echnol-
ogy, hey do no compe e on he p ice o hei p oduc s.
12 L. Benz e al.: Hidden champions as a de e minan o egional de elopmen
The e o e, p ices a e ypically abo e he ma ke a e age,
which in combina ion wi h hei in e na ional expansion
signi ican ly con ibu es o niche ma ke p o i abili y.
Analyzing a sample o 4,677 Ge man manu ac u ing i ms
o e a pe iod o en yea s, Johann e al. (2021) o example
show ha HCs ha e a signi ican ly highe p o i abili y
wi h ega d o e u n on asse s han non-HCs.
2.2 De e minan s and dimensions o
egional de elopmen
Regional de elopmen ep esen s a mul i ace ed cons uc
ha links bo h di e en de e minan s and di e en dimen-
sions a he egional le el, as he p ocesses and esou ces
a ailable o a egion de e mine i s de elopmen along
se e al dimensions (S imson e al. 2006). Wi h ega d o
he de e minan s o egional de elopmen , p io esea ch
has in es iga ed, among o he hings, whe he he p es-
ence o ce ain i m ypes a ec s egional de elopmen .
Fo example, schola s ha e examined he ole o amily
businesses (e. g. Basco 2015; Block/Spiegel 2013; S ough e
al. 2015). S a ing wi h he speci ic cha ac e is ics o amily
businesses, Basco (2015) sys ema ically links he amily
business and egional de elopmen li e a u es o analyze
whe he amily businesses a ec he ac o s, p ocesses,
and p oximi y dimensions o egional de elopmen . Sim-
ila ly, S ough e al. (2015) in es iga e whe he and how
amily businesses con ibu e o egional economic g ow h
and de elopmen . Mo eo e , Block & Spiegel (2013) s udy
he impac o amily i m densi y on egional inno a ion
ou pu . Fu he mo e, schola s ha e analyzed he in luence
o new business o ma ion on egional de elopmen (e. g.
F i sch 2008; S ue ze e al. 2014). Fo example, F i sch
& Mülle (2004) examine he ela ionship be ween new
business o ma ion and egional de elopmen o e ime,
iden i ying ime lags as well as bo h posi i e and nega i e
e ec s o new business o ma ion on egional employ-
men changes. As a ollow-up, F i sch & Sch oe e (2011)
in es iga e he e ec o s a -up ac i i y on employmen
g ow h a he egional le el, inding an in e se U-shaped
ela ionship. Howe e , while p io esea ch has equen ly
examined he impac o speci ic ypes o i ms, such as
amily businesses o s a -ups, on egional de elopmen ,
esea ch analyzing HCs as a de e minan o egional de el-
opmen is a he sca ce. Lang and colleagues (2019) as
well as Vonnahme & Lang (2019) examine he ole o HCs
in small owns and pe iphe al egions. Analyzing i e eco-
nomic indica o s, Lang and colleagues (2019) show ha
small owns wi h HCs, in pe iphe al as well as non-pe iph-
e al egions, a e in a be e economic si ua ion han small
owns wi hou HCs. Also, quali a i e esea ch on HCs as
a de e minan o egional de elopmen exis s in o m o
case s udies (e. g. Ki chne 2019). Taking a quan i a i e
app oach, Vonnahme & Lang (2019) examine inno a ion
ac i i ies based on a su ey o 129 HCs. Since no homoge-
neous pic u e o he inno a ion beha io o HCs can be
d awn, a clus e analysis di ides he i ms in o g oups ha
di e , o ins ance, wi h ega d o he geog aphic ocus o
inno a ion ac i i ies. As he ex en o which HCs con ib-
u e o p og ess and p ospe i y a he egional le el emains
mainly unclea , his pape aims o empi ically in es iga e
he e ec o HCs on se e al dimensions o egional de el-
opmen .
Conce ning he dimensions o egional de elopmen ,
p io esea ch has o e ed a di e se se o hema ic p io -
i ies, including economic (e. g. Po e 2003), ins i u ional
(e. g. Rod iguez-Pose 2013) and social (e. g. Iye e al. 2005)
dimensions. Focusing on he economic dimensions o
egional de elopmen , schola s ha e in es iga ed egional
inno a i eness (e. g. B oekel/B enne 2011). In his
con ex , F i sch & Sla che (2011) emphasize he ole o
egional inno a ion sys ems, empi ically analyzing ac o s
ha accoun o di e ences in he e iciency o egional
inno a ion sys ems. Mo eo e , a ious s udies ha e in es-
iga ed he inno a ion ou pu o egions as measu ed by
he numbe o success ul pa en applica ions (e. g. Be le-
mann/Jahn 2016; Block/Spiegel 2013). In addi ion o ana-
lyzing dimensions ela ed o knowledge c ea ion a he
egional le el, o he s ha e conside ed employmen - ela ed
dimensions (e. g. F i sch/Mülle 2008). Rela ing s a -up
a es o egional employmen changes o e ime, F i sch
& Mülle (2008), o example, ind signi ican di e ences
ac oss egions in Ge many; he e ec s o new business
o ma ion on egional employmen changes a e highe in
agglome a ions and egions wi h a high le el o labo p o-
duc i i y han in u al a eas and egions wi h a low le el
o labo p oduc i i y. Fo his s udy, we selec h ee di e -
en dimensions o egional de elopmen in o de o o e a
b oad pic u e on how HCs in luence egional de elopmen .
3 Hypo heses
Since p io esea ch has no su icien ly add essed he
ole o HCs as a de e minan o egional de elopmen ,
he p esen s udy empi ically in es iga es he e ec o
HCs on he ollowing h ee dimensions o egional de el-
opmen : (1) egional economic pe o mance, (2) egional
employmen , and (3) egional inno a ion. These h ee
dimensions o egional de elopmen and he e e -
L. Benz e al.: Hidden champions as a de e minan o egional de elopmen 13
ing a iables only pa ially cap u e he ole o HCs as a
de e minan o egional de elopmen . In he ollowing
sec ions, we p esen each dimension and add ess hei
ope a ionaliza ion and he co esponding hypo heses.
Figu e 1 p o ides an o e iew o he se en hypo heses and
he expec ed in luence o HC in ensi y on hese egional
de elopmen dimensions. In ou s udy, we ocus on he
HCs’ headqua e s1. E en hough HCs o ganize hei wo k
on a e age wi h en di e en loca ions (Vonnahme/Lang
2019), p io esea ch shows ha he headqua e s o mul-
ina ional and mul ibusiness i ms play a signi ican ole
in an en ep eneu ial as well as adminis a i e sense (e. g.
Ambos/Mahnke 2010; Chandle 1991; Landau/Bock 2013).
The e o e, we would like o pu an emphasis on he HCs’
headqua e s and hei impac on egional de elopmen .
3.1 Regional economic pe o mance
The economic pe o mance o a na ion is closely linked
o ha o i s indi idual egions, which can a y consid-
e ably. The e o e, many o he essen ial de e minan s o
economic pe o mance eside wi hin indi idual egions
a he han na ions (e. g. Po e 2003; Ki son e al. 2004).
One o he mos commonly used measu es o economic
pe o mance is g oss domes ic p oduc (GDP). GDP ep e-
sen s he o al alue o all goods, including p oduc s and
se ices, gene a ed in one yea wi hin he na ional bo de s
o an economy. When ans o med in o GDP pe capi a o
a de ined a ea, conclusions abou he de elopmen and
pe o mance o a egion a e possible. GDP is p ima ily gen-
e a ed by he p oduc ion o goods. Al hough HCs ope a e
in niche ma ke s wi h small p oduc ion olumes, ope a -
ing on an in e na ional scale o e s he po en ial o expand
hei p oduc ion olumes. Since hey manu ac u e on hei
own, HCs possess la ge p oduc ion acili ies, o en loca ed
in u al a eas. By p oducing la ge quan i ies locally (e. g.
Lehmann e al. 2019), HCs signi ican ly con ibu e o he
GDP o hei na i e egions. Consequen ly, we expec dis-
ic s wi h a high in ensi y o HC headqua e s o exhibi a
highe GDP pe capi a.
Hypo hesis 1a: Regional HC in ensi y is posi i ely
associa ed wi h egional GDP.
In addi ion o GDP, which cap u es he p oduc i e
s eng h o a egion, income le els a e a undamen al
measu e o economic pe o mance, as hey e lec he
s anda d o li ing o he egional wo k o ce (Po e 2003).
As p e iously men ioned, HCs gene a e huge p o i s by
1 I he global headqua e is loca ed ou side o Ge many, we include
he na ional Ge man headqua e o he HC.
selling specialized goods on a global scale. Since HCs a e
deeply oo ed in hei home egion, a la ge po ion o hei
p o i s lows in o he i m and i s employees. Mo eo e ,
HCs a e s able employe s who iew hei wo k o ce as
an impo an ac o in hei success (e. g. Lehmann e al.
2019; Voudou is e al. 2000). Hence, mone a y incen i es
play an impo an ole in keeping employees o e he long
e m. P o i ably ope a ing wi hin global niche ma ke s,
HCs ypically possess su icien economic s eng h o o e
mone a y incen i es and pay adequa e sala ies. Conse-
quen ly, we expec dis ic s wi h a high in ensi y o HC
headqua e s o ha e a highe median income.
Hypo hesis 1b: Regional HC in ensi y is posi i ely
associa ed wi h egional labo income.
In addi ion o GDP and labo income, business axes
ep esen ano he app op ia e indica o o egional eco-
nomic pe o mance, adding a ax pe spec i e o he p e-
sen ed measu es. Business axes a e le ied on he ea n-
ings gene a ed by a domes ic business. Thus, he amoun
o business ax o be paid di ec ly depends on he amoun
o p o i s made. The e o e, business axes a e he mos
impo an sou ce o e enue o a dis ic ’s municipali-
ies. Fo he same easons as hose al eady p esen ed o
hypo heses 1a and 1b, HCs signi ican ly con ibu e o he
business ax e enue o he municipali y in which hey
a e loca ed (Lang e al. 2019; Röhl 2008). Because HCs
success ully ope a e wi hin global niche ma ke s, hey
achie e compa a i ely high p o i s, hus leading o high
business ax paymen s. Also, since HCs ac independen ly
and concen a e mos o hei ac i i ies and employees in
hei selec ed loca ions (e. g. local p oduc ion acili ies),
business ax paymen s low almos en i ely in o hei
na i e municipali ies (e. g. Becke /Fues 2010). As a esul ,
municipali ies ha a e home o HCs ha e highe business
ax e enues. Weal hy municipali ies in u n o m he
basis o he inancial s eng h and economic p ospe i y
o en i e dis ic s. Consequen ly, we expec dis ic s wi h a
high in ensi y o HC headqua e s o ha e highe business
ax e enues.
Hypo hesis 1c: Regional HC in ensi y is posi i ely asso-
cia ed wi h egional business ax e enues.
3.2 Regional employmen
In addi ion o pe o mance indica o s, human esou ce- e-
la ed igu es e lec egional de elopmen . Regional
employmen e e s o he p opo ion o wo king-age
people employed wi hin a gi en egion. Due o egional
di e ences in popula ion densi y, he unemploymen a e
se es as an accep ed indica o o employmen le els,
14 L. Benz e al.: Hidden champions as a de e minan o egional de elopmen
making egions mo e compa able. Because HCs se e
global niche ma ke s, hey need o handle ela i ely la ge
p oduc ion quan i ies. None heless, HCs a oid ou sou c-
ing o s a egic alliances and ely on maximum inde-
pendence as well as con ol in p oduc ion (Simon 2013).
Consequen ly, hey equi e a la ge wo k o ce. Thei s ong
g ow h u he uels he con inuous demand o quali ied
employees. As a esul , HCs y o manage he ec ui men
and long- e m e en ion o employees by o e ing a ac-
i e jobs and amilial co po a e cul u es (e. g. Lehmann e
al. 2019; Voudou is e al. 2000). Acco dingly, HCs make
la ge in es men s in human esou ce managemen p ac-
ices (Ramme /Spielkamp 2019), ac ing as eliable long-
e m employe s wi hin mos ly u al egions (Lang e al.
2019; Lehmann e al. 2019; Pahnke/Wel e 2019). HCs
pe manen ly a ac new employees and hus signi i-
can ly con ibu e o egional employmen . As a esul , we
expec dis ic s wi h a high in ensi y o HC headqua e s
o exhibi lowe unemploymen a es.
Hypo hesis 2a: Regional HC in ensi y is nega i ely
associa ed wi h he egional unemploymen a e.
The manu ac u e o ad anced p oduc s also equi es
speci ic expe ise and echnical knowledge (e. g. Lehmann
e al. 2019; Ramme /Spielkamp 2015, 2019). Hence, HCs
need specially ained wo ke s and in es no only in he
aining and de elopmen o employees bu also in he
educa ion o he ainees hemsel es. In pa icula , he
dual app en ice sys em in Ge many, which speci ically
combines heo e ical and p ac ical eaching con en ,
is an impo an pilla o he HC employmen s a egy
(Aud e sch e al. 2020; Jahn 2018; Lehmann e al. 2019;
Schenkenho e /Wilhelm 2020). I sys ema ically ensu es
he echnical compe ence o he wo k o ce ha is neces-
sa y o p o ide high-quali y p oduc s. Jahn (2018) also
e i ies a signi ican ly posi i e ela ionship be ween he
ela i e impo ance o medium-sized i ms and app en-
iceship aining a he egional le el. Consequen ly, we
expec dis ic s wi h a high in ensi y o HC headqua e s
o ha e highe numbe s o ainees.
Hypo hesis 2b: Regional HC in ensi y is posi i ely
associa ed wi h he egional ainee a e.
3.3 Regional inno a ion
The ele ance o egional inno a ion as well as i s possi-
ble de e minan s ha e ecei ed g ea a en ion in ecen
esea ch (e. g. Block e al. 2021; F i sch/Sla che 2011;
Makkonen/ an de Ha e 2013). Fo example, B oekel &
B enne (2011) examine how wel e selec ed egional
ac o s, including he numbe o R&D employees, he
p esence o uni e si ies and echnical colleges, and public
esea ch ins i u ions, among o he s, a ec he inno a i e-
ness o a egion. Simila o a ious o he s udies (e. g. Block/
Spiegel 2013; F i sch/Sla che 2011; F i sch/Wy wich
2021; Thomi/We ne 2001), hey ela e hese ac o s o he
concep o egional inno a ion sys ems. A egional inno-
a ion sys em desc ibes he componen s and p ocesses o
inno a ion on a egional le el, o ming an ins i u ional
se ing wi hin a egion in which i ms and o he o gani-
za ions in e ac and lea n om each o he (Cooke 2001;
Cooke e al. 1998). This sys em p o ides a ge ed suppo
o inno a ion ac i i ies a he egional le el by c ea ing an
inno a ion- iendly clima e ha s imula es esea ch coop-
e a ion, knowledge c ea ion, and spillo e s. Ul ima ely,
his leads o inc eased egional inno a ion ac i i ies, bo h
wi h ega d o inno a ion inpu , o example, in e ms o
R&D expendi u es, and inno a ion ou pu , o example,
indica ed by he numbe o pa en applica ions and new
p oduc de elopmen s. R&D expendi u es and g an ed
pa en s only ep esen a ac ion o local inno a ion
ac i i ies and allow limi ed s a emen s on he inno a ion
dynamics o a egion as hey ocus almos exclusi ely on
echnological inno a ion (Block e al. 2021); howe e , hey
a e es ablished indica o s in his con ex (e. g. F i sch/
Sla che 2011).
Niche i ms play a pa icula ly impo an ole wi hin
egional inno a ion sys ems, as hey equi e subs an ial
expe ise and p o ound knowledge o p o ide cus ome s
wi h specialized p oduc s (e. g. Dalgic/Leeuw 1994). Thus,
o mee indi idual equi emen s and o e echnological
enhancemen s, HCs main ain la ge inno a ion capaci-
ies (e. g. Ramme /Spielkamp 2015, 2019). Wi h ega d o
inno a ion inpu , HCs a e associa ed wi h high le els o
R&D in es men s (e. g. Aud e sch e al. 2018; Schleppho s
e al. 2016; Zucchella/Palama a 2006). In a su ey o 129
Ge man HCs, Vonnahme & Lang (2019) ind ha mo e han
80 pe cen conduc in-house R&D. In addi ion o hei own
R&D ac i i ies, HCs o en main ain egional ela ionships
wi h uni e si ies and esea ch ins i u ions o inno a ion
de elopmen , hus os e ing he c ea ion and exchange o
knowledge (Ramme /Spielkamp 2015). Also, he majo i y
o HCs assigns R&D con ac s o hi d pa ies (Vonnahme/
Lang 2019). Fu he , F i sch & Sla che (2011) show ha
knowledge spillo e s enhance p i a e sec o inno a ion
ac i i y, posi i ely in luencing egional inno a ion sys em
e iciency. The e o e, by con inuously in es ing in inno-
a ion (e. g. Ramme /Spielkamp 2015, 2019), HCs con ib-
u e o echnological p og ess and subs an ially p omo e
egional inno a ion. Consequen ly, we expec dis ic s
wi h a high in ensi y o HC headqua e s o exhibi highe
R&D expendi u es.
L. Benz e al.: Hidden champions as a de e minan o egional de elopmen 15
Hypo hesis 3a: Regional HC in ensi y is posi i ely
associa ed wi h egional R&D in ensi y.
Fu he mo e, he inno a ion ac i i ies o HCs a e also
isible wi h ega d o inno a ion ou pu . As HCs claim o
be quali y and echnology leade s wi hin global niches,
hey ac i ely shape hei ma ke s by se ing s anda ds and
aking on a pionee ing ole in he in oduc ion o ma ke
no el ies. Typically, HCs conque hei niche ma ke s wi h
adical inno a ions and subsequen ly de end hei ma -
ke -leading posi ion h ough inc emen al imp o emen s
(e. g. Aud e sch e al. 2020; Ramme /Spielkamp 2015,
2019; Voudou is e al. 2000). The inno a ion a e o HCs
conside ably exceeds he a e age a e o he Ge man
economy (Vonnahme/Lang 2019). As a esul , he p o-
ec ion o in ellec ual p ope y plays an impo an ole,
pa icula ly wi h ega d o p oduc inno a ions. In addi-
ion o lead- ime ad an ages, HCs hea ily ely on pa en s
as an e ec i e p o ec ion mechanism. Typically, HCs
possess signi ican ly mo e pa en s han la ge i ms do
(e. g. Ramme /Spielkamp 2019). Thus, hei leading ole in
knowledge c ea ion and inno a ion de elopmen esul s
in highe inno a ion ou pu a he egional le el, which
is pa ly e lec ed by pa en indica o s. Consequen ly, we
expec dis ic s wi h a high in ensi y o HC headqua e s
o ha e a highe numbe o g an ed pa en s.
Hypo hesis 3b: Regional HC in ensi y is posi i ely
associa ed wi h egional pa en in ensi y.
4 Da a and me hod
4.1 Da a sou ces and sample
The sample in ou s udy consis s o 401 obse a ions, ep-
esen ing he 401 Ge man dis ic s lis ed in able A1. These
e e o he NUTS 3-le el (Nomencla u e des uni és e i o i-
ales s a is iques), he o icial classi ica ion o he Eu opean
Union o egional s a is ics, including all Ge man dis ic s
and independen ci ies (Eu opean Union, 2018). Da a a
he dis ic le el s em om a ious sou ces: (1) he INKAR
online da abase o he Fede al O ice o Building and
Regional Planning (BBSR), (2) he Eu opean Pa en O ice
(EPO), (3) he Regional Da abase o he S a is ical O ices
o he Fede al Republic o Ge many and he Fede al S a es,
(4) he Dono s’ Associa ion o Science S a is ics, and (5)
he Communal Educa ion Da abase o he S a is ical O ices
o he Fede al Republic o Ge many and he Fede al S a es.
Sec ion 4.2 p o ides mo e de ails on he da a sou ce o
each a iable. The independen a iable HC in ensi y is an
excep ion, as we i s collec da a o his a iable a he i m
le el ia he Bu eau an Dijk da abase O bis and he Elec-
onic Fede al Gaze e (Bundesanzeige ) and hen con e i
in o a dis ic -le el a iable (see sec ion 4.2.2). Addi ionally,
we accessed da a on he C-DAX s ocks om he webpage o
he Deu sche Bö se AG, and en u e capi al (VC) in es men
da a s em om he business-ma ching pla o m Spo olio.
Figu e 1: In luence o HC in ensi y on egional de elopmen dimensions.
Sou ce: Own ep esen a ion.
16 L. Benz e al.: Hidden champions as a de e minan o egional de elopmen
4.2 Va iables
In he ollowing, we desc ibe he a iables included in
ou analyses in de ail. Addi ionally, able A2 p o ides a
summa y o he a iables, including a iable names, sho
desc ip ions o he a iables, he da a sou ces, and a ia-
ble ca ego ies.
4.2.1 Dependen a iables
Se en dependen a iables a e included in ou s udy,
e e ing o he h ee egional de elopmen dimensions
iden i ied in sec ion 3. Regional economic pe o mance is
cap u ed by GDP pe capi a in eu os pe dis ic in 2016;
median income, measu ed as he mon hly sala ies o ull-
ime employees subjec o social insu ance con ibu ions
in eu os pe dis ic in 2017; and business ax e enues in
eu os pe inhabi an pe dis ic in 2017. Da a o all h ee
a iables a e e ie ed om he INKAR online da abase.
The unemploymen a e is he i s indica o o he
second dimension, egional employmen . I is measu ed as
he sha e o unemployed indi iduals in he ci ilian labo
o ce in pe cen pe dis ic in 2017. A u he indica o o
his dimension is he a iable ainees pe 1,000 employees
as he numbe o ainees pe 1,000 employees subjec o
social insu ance con ibu ions pe dis ic in 2017. Da a o
bo h a iables a e ob ained om INKAR.
Regional inno a ion ac i i y is he hi d dimension
which is pa ly co e ed by wo es ablished indica o s (e. g.
F i sch/Sla che 2011). A measu e o he inno a ion
inpu is R&D in ensi y. The ini ial da a o his a iable
s em om he Dono s’ Associa ion o Science S a is ics,
p o iding o al co po a e in e nal R&D expendi u es,
including pe sonnel expenses in housands o eu os,
o 377 dis ic s in 2015. Fo p i acy easons, he alues
o he emaining 24 dis ic s a e included in he o al o
ano he dis ic . The e o e, we di ide his o al alue by
he numbe o dis ic s i comp ises and use he esul o
eplace he missing da a o his a iable in he da ase ,
hus keeping o e all R&D expendi u es cons an . Finally,
we calcula e R&D expendi u es pe 100,000 inhabi an s,
gi ing he o al co po a e in e nal R&D expendi u es in
housands o eu os pe 100,000 inhabi an s pe dis ic
in 2015. Ano he a iable belonging o his dimension
and e e ing o he inno a ion ou pu is pa en in ensi y,
which is he numbe o pa en s g an ed pe 100,000 inhab-
i an s pe dis ic be ween 2011 and 2015. The o al numbe
o pa ens pe dis ic be ween 2011 and 2015 o 402 dis-
ic s is aken om he EPO. Since No embe 2016, only
401 dis ic s ha e exis ed due o Os e ode and Gö ingen
being combined in o a single dis ic , Gö ingen; hence, we
u ilize he mean alue o he pa en s om he wo o me
dis ic s as he alue o he combined dis ic . Addi ion-
ally, we ob ain he numbe o inhabi an s in each dis ic
om INKAR, which we hen di ide by 100,000. Finally, he
o al numbe o pa en s is di ided by his alue o ob ain
he numbe o pa en s g an ed pe 100,000 inhabi an s
pe dis ic .
4.2.2 Independen a iable
The s a ing poin o ou independen a iable is he con-
s uc ion o a sample consis ing o 1,645 Ge man HCs. A
lis -based sea ch was conduc ed in o de o iden i y he
HCs. As a ounda ion, he HC lis s o Wi scha sWoche
(2020) Langenscheid and Venoh (2014) and Simon (2012)
we e combined. In addi ion, we checked o he i m lis s
such as he lis o Ge man amily en e p ises by Seibold
e al. (2019) and he lis s o inno a i e (Mi els and) i ms
published in Yogeshwa (2019) and F ank u e Allgemeine
Zei ung (2019) o po en ial HCs. In o ma ion on ma ke
leade ship was addi ionally selec ed om he i m web-
si es o he espec i e i ms. Fu he mo e, we se Google
ale s o he e ms Wel ma k üh e and Hidden Champion
in o de o iden i y addi ional HCs o ou sample.
The 1,645 i ms iden i ied ul ill i e c i e ia. Fi s , hey
a e among he op h ee ma ke leade s wo ldwide o a e
numbe one on a con inen . Second, hei e enues o
2019, 2018, o 2017 mus lie be ween en million and i e
billion eu os. Depending on a ailabili y, he e enue da a
a e aken om he Bu eau an Dijk da abase O bis o he
elec onic Fede al Gaze e. Thi d, all i ms mus be olde
han en yea s and employ mo e han 50 people. In o -
ma ion on ounding yea s and employee numbe s s ems
om O bis o he i m websi es. Fou h, all i ms mus be
loca ed in Ge many. Fi h, subsidia ies o o eign i ms a e
only included i hey ope a e independen ly o he mo he
i m. As he ypical HC c i e ion unknown o he public is
di icul o measu e, we do no include i in ou s udy.
A e cons uc ing ou sample o 1,645 Ge man HCs,
we ob ain da a on he NUTS 3 le el o hese i ms ia O bis
and he i m websi es. Thus, we a e able o calcula e he
o al numbe o HCs o each o he 401 Ge man dis ic s.
Addi ionally, we di ide he numbe o inhabi an s in each
dis ic by 100,000. Finally, he o al numbe o HCs is
di ided by his alue o c ea e ou independen a iable
HC in ensi y: he numbe o HCs pe 100,000 inhabi an s
pe dis ic .
L. Benz e al.: Hidden champions as a de e minan o egional de elopmen 23
a iables emains una ec ed. In addi ion, we combine
he wo academic educa ion a iables and es he e ec
o using he numbe o uni e si ies and echnical colleges
as a con ol a iable in he eg ession analysis. Compa ed
o hose o he ini ial a iable, he e ec s o uni e si y and
echnical college in ensi y on median income, ainees pe
1,000 employees and pa en in ensi y become insigni i-
can , and we unco e a posi i e e ec on business ax e -
enues (β=34.29, p<0.05). Again, he signi icance o he
e ec o HC in ensi y on he dependen a iables emains
una ec ed. Thus, he numbe o uni e si ies a ec s
egional de elopmen dimensions mo e signi ican ly han
he numbe o echnical colleges.
As a u he obus ness check, addi ional con ol a i-
ables a e in eg a ed in o he eg ession analysis. We calcu-
la e he numbe o VC in es men s pe 100,000 inhabi an s
pe dis ic be ween 2011 and 2015, namely, VC in es men
in ensi y, o cap u e he numbe o inno a i e new busi-
nesses. Da a on VC in es men s come om Spo olio, a
business-ma ching pla o m wi h a ocus on inno a i e
Ge man high- ech i ms. Excep o a signi ican ly nega i e
e ec on ainees pe 1,000 employees (β=–0.46, p<0.01),
he addi ional con ol a iable is ound o ha e no e ec . In
addi ion, he dependen a iable R&D in ensi y is used as
a con ol a iable o he dependen a iable pa en in en-
si y in a supplemen a y eg ession analysis o examine he
ela ionship be ween he wo inno a ion a iables. Sligh
scaling adjus men s, i. e., ecalcula ing he a iable as he
o al co po a e in e nal R&D expendi u es in millions o
eu os, inc ease i s applicabili y as a con ol a iable. R&D
in ensi y exe s a signi ican ly posi i e in luence on pa en
in ensi y (β=0.32, p<0.01). As expec ed, he inno a ion
inpu o a dis ic in luences i s inno a ion ou pu .
As a inal obus ness check, we ecalcula e he inde-
penden a iable HC in ensi y as he numbe o HCs pe
100,000 employees pe dis ic . Da a on he numbe o
employees pe dis ic in 2017 s em om he Regional
Da abase o he S a is ical O ices o he Fede al Republic
o Ge many and he Fede al S a es. We ind simila signi -
ican e ec s on he dependen a iables in he eg ession
analysis, excep o he impac on business ax e enue,
which loses signi icance. Unsu p isingly, e ec sizes a e
smalle o HC in ensi y pe 100,000 employees, as he
numbe o employees pe dis ic is below he co espond-
ing numbe o inhabi an s. Addi ionally, we e un he
eg ession analyses using he absolu e numbe o HCs pe
dis ic as he independen a iable. Signi ican ly posi i e
in luences on median income, business ax e enue, and
pa en in ensi y pe sis .
A se ies o pos hoc analyses, which do no ocus on
ou hypo heses, comple es he examina ions o his s udy,
s a ing wi h he es o VC in es men in ensi y as an addi-
ional dependen a iable in he eg ession analysis. HC
in ensi y does no signi ican ly in luence VC in es men
in ensi y, i. e., he numbe o inno a i e business o ma-
ions. Thus, his dependen a iable is no u he exam-
ined.
Addi ionally, we pe o m a seemingly un ela ed
eg ession wi h he a iables included in he main anal-
ysis, assuming co ela ion in he e o e ms ac oss he
equa ions. The signi ican and insigni ican e ec s o
HC in ensi y on he dependen a iables emain, and he
e ec sizes a e nea ly equal o hose ound in he esul s o
he linea eg ession models.
As HCs a e a gued o be mainly ac i e in he manu-
ac u ing sec o (Ramme /Spielkamp 2015, 2019), we
would like o analyze whe he he e ec s o HC in ensi y
on hese egional dimensions a e d i en by he manu ac-
u ing i ms in he sample. The e o e, he NACE codes o
he HCs a e collec ed ia O bis; missing da a a e supple-
men ed by a pe sonal assessmen o he indus y a e col-
lec ing in o ma ion om he i m websi es. We hen di ide
he sample in o wo g oups: i ms mainly ac i e in manu-
ac u ing, i. e., NACE codes en o hi y- h ee, and i ms
in he emaining indus ies. HC in ensi y measu ed as he
numbe o HCs pe 100,000 inhabi an s pe dis ic is hen
ecalcula ed o he wo g oups, esul ing in manu ac u -
ing HC in ensi y and nonmanu ac u ing HC in ensi y. Figu e
4 shows he esul s o he linea eg ession analyses.
S a ing wi h expo s as a quali y assessmen o ou HC
sample selec ion, only manu ac u ing HC in ensi y exe s
a signi ican in luence on egional-le el expo in ensi y
(β=91,042.16, p<0.01).
Conce ning he ou egional de elopmen dimen-
sions, we de ec di e gen in luences o he wo HC in en-
si ies on se e al dependen a iables. In e ms o egional
economic pe o mance, he egional median income is
a ec ed only by manu ac u ing HC in ensi y (β=38.73,
p<0.01), as is he case o business ax e enues (β=16.24,
p < 0.01). The ainees pe 1,000 employees a e also
a ec ed only by he HC in ensi y o manu ac u ing i ms
(β=1.24, p<0.01), ep esen ing he di e ing in luence o
he di e en HCs on egional employmen . As a measu e
o egional inno a ion ou pu , pa en in ensi y is a ec ed
by bo h manu ac u ing HC in ensi y (β=6.45, p<0.05)
and nonmanu ac u ing HC in ensi y (β=16.55, p<0.1).
In e ms o he o he dependen a iables, we do no ind
signi ican e ec s o he wo HC in ensi ies. Howe e , he
di e ing esul s o expo s and he ou dependen a i-
ables p esen ed abo e show ha HCs a e a g oup o i ms
ha a e indeed he e ogeneous.
24 L. Benz e al.: Hidden champions as a de e minan o egional de elopmen
Table 4: Linea eg ession analyses wi h HC in ensi y di ided in o manu ac u ing and non-manu ac u ing i ms.
Regional economic pe o mance Regional educa ion Regional inno a ion
Dependen a iables GDP pe capi a
(H1a)
Median income
(H1b)
Business ax e e-
nues (H1c)
Unemploymen a e
(H2a)
T ainees pe 1,000
employed (H2b)
R&D in ensi y
(H3a)
Pa en in ensi y
(H3b)
Expo in ensi y
Coe (SE) Coe (SE) Coe (SE) Coe (SE) Coe (SE) Coe (SE) Coe (SE) Coe (SE)
Independen a iables
Manu ac u ing HC
in ensi y
497.54
(333.21)
38.73
(7.96)***
16.24
(5.67)***
‐0.07
(0.04)
1.24
(0.19)***
‐708.45
(3,204.18)
6.45
(2.53)**
91,042.16
(30,894.69)***
Non-manu ac u ing HC
in ensi y
‐834.10
(1,174.73)
32.79
(28.06)
7.55
(19.99)
‐0.24
(0.15)
‐0.20
(0.68)
2,310.52
(11,296.43)
16.55
(8.93)*
‐131,538.9
(108,920.1)
Con ol a iables
Popula ion densi y 6.97
(1.09)***
0.12
(0.03)***
0.11
(0.02)***
0.00
(0.00)***
‐0.00
(0.00)***
23.41
(10.48)**
0.04
(0.01)***
127.23
(101.08)
Popula ion a e age age ‐2,653.62
(415.39)***
‐117.11
(9.92)***
‐42.93
(7.07)***
0.70
(0.05)***
‐2.06
(0.24)***
‐17,722.18
(3,994.46)***
‐14.06
(3.16)***
‐117,429.8
(38,514.52)***
Fi m in ensi y 4.14
(1.05)***
‐0.05
(0.03)**
0.12
(0.02)***
‐0.00
(0.00)***
‐0.00
(0.00)
‐14.50
(10.10)
0.01
(0.01)
‐56.90
(97.41)
Uni e si y in ensi y 4,940.35
(1,942.24)**
‐97.17 (46.40)** ‐21.35
(33.05)
0.98
(0.25)***
‐3.95
(1.12)***
‐3,478.05
(18,676.9)
‐27.43
(14.76)*
120,094.5
(180,082.5)
C-DAXin ensi y 4,404.78
(1,018.54)***
112.48
(24.33)***
69.38 (17.33)*** ‐0.00
(0.13)
‐2.12
(0.59)***
22,167.6
(9,794.48)**
40.94
(7.74)***
109,988.8
(94,438.27)
New business
o ma ion in ensi y
‐18.99
(5.87)***
0.25
(0.14)*
‐0.12
(0.10)
0.00
(0.00)***
0.01
(0.00)
‐108.54 (56.49)* ‐0.17
(0.04)***
‐233.98
(544.68)
Cons an 140,874.1
(20,268.36)***
8,195.73
(484.20)***
1,893.32
(344.92)***
‐22.77
(2.58)***
133.64
(11.70)***
966,627.4
(194,904.4)***
692.72
(154.07)***
6,467,126
(1,879,267)***
R² 0.41 0.58 0.47 0.59 0.35 0.12 0.30 0.09
F 34.57*** 68.98*** 44.05*** 69.75*** 26.81*** 6.68*** 21.37*** 4.72***
n=401 dis ic s; wo-sided es s: *=p ≤ 0.10, **=p ≤ 0.05, ***=p ≤ 0.01; Coe =coe icien s, H=hypo hesis; SE=s anda d e o
L. Benz e al.: Hidden champions as a de e minan o egional de elopmen 25
6 Discussion, limi a ions and
ou look
6.1 Discussion
By analyzing egional HC in ensi y in he con ex o
egional de elopmen , we e eal se e al signi ican e ec s
on h ee egional de elopmen dimensions: egional
economic pe o mance, employmen , and inno a ion.
Rega ding he i s dimension o egional economic pe o -
mance, we ind ha HC in ensi y exe s a signi ican in lu-
ence on median income and business ax e enues. This
shows ha a po ion o he alue c ea ion gene a ed by
HCs emains in hei egion and is passed on o he inhabi -
an s o he egion h ough sala ies and o he go e nmen s
o he dis ic s in he o m o business ax paymen s. A sig-
ni ican impac on GDP pe capi a canno be con i med.
Hence, he p oduc ion olume ha HCs p ocess locally
seems o be smalle han expec ed. This aligns wi h he
indings o He s a e al. (2017) ha al hough HCs concen-
a e hei p oduc ion ac i i ies in hei Ge man headqua -
e s, mos i ms pu sue a coope a i e p oduc ion s a egy
and p oduce in BRIC coun ies, especially China and
India. Acco ding o a s udy by Vonnahme & Lang (2019),
85 pe cen o he 129 HCs su eyed possess mo e han one
loca ion, while he mean alue accoun ed o en loca ions
wo ldwide. This also implies ha he p oduc ion o HCs is
no exclusi ely limi ed o he Ge man headqua e s. Fu -
he mo e, spa ial au o eg essi e analyses e eal ha he e
is no signi ican di ec e ec o HC in ensi y on GDP pe
capi a bu he e is such an e ec on bo h median income
and business ax e enues. In addi ion, HC in ensi y has
signi ican indi ec and o al e ec s on median income.
Once again, al hough he insigni ican e ec o HC in en-
si y on GDP pe capi a is somehow su p ising gi en ou
ini ial a gumen a ion o hypo hesis 1a, i is in line wi h
he esul s o ou main analyses. Mo eo e , signi ican
esul s o median income a e easonable, as inhabi an s
o neighbo ing dis ic s mo e be ween dis ic s o wo k a
HC i ms bu ecei e hei income in hei home dis ic .
Business axes, howe e , a e paid in he dis ic whe e he
HC is loca ed; i. e., HC in ensi y has only a di ec e ec on
ax e enue.
Fo he second dimension, egional employmen , we
ind suppo o he impac o egional HC in ensi y on
bo h he egional unemploymen a e and he numbe o
ainees pe 1,000 employees. Hence, HCs a e essen ial
employe s and aine s in hei dis ic s. The p e ious li -
e a u e s a ing ha HCs in es highly in o human capi al
s eng hens his a gumen (e. g. Ramme /Spielkamp
2019). Fu he mo e, spa ial au o eg essi e analyses show
mixed e ec s o HC in ensi y on he egional unemploy-
men a e. Al hough HC in ensi y does no in luence he
unemploymen a e wi hin he HCs’ home dis ic s, i
has signi ican indi ec and o al e ec s, emphasizing
hei eno mous egional scope as majo employe s. Due
o con inuous g ow h and mos ly independen business
ac i i ies, HCs equi e a la ge wo k o ce ha hey a ac
sup a- egionally and e ain o e he long un, hus con-
ibu ing o inc eased employmen le els ac oss dis ic s.
Consequen ly, his inding again unde lines he ac ha
employees a el be ween dis ic s o wo k a HC i ms.
Addi ionally, HC in ensi y has bo h a signi ican di ec
and o al e ec on ainees pe 1,000 employees. Al hough
HCs ain hei own specialis s wi hin hei home dis ic s,
hei s ong emphasis on ainees also has a clea e ec
beyond hei home dis ic s. Thus, HCs play a meaning-
ul ole in employmen and aining (e. g. Lehmann e al.
2019) bo h wi hin and ac oss dis ic s.
HC in ensi y signi ican ly a ec s he hi d dimen-
sion o egional inno a ion only in e ms o inno a ion
ou pu , i. e., egional pa en in ensi y, bu no in e ms o
inno a ion inpu , measu ed by egional R&D in ensi y.
Al hough HCs a e associa ed wi h high R&D expendi u es
(e. g. Aud e sch e al. 2018; Schleppho s e al. 2016; Simon
2012), no egional-le el impac on R&D in ensi y is ound.
This esul co esponds wi h he indings o Ramme &
Spielkamp (2015, 2019), who a gue ha HCs do no spend
mo e on R&D han o he i ms bu a he use esou ces
mo e e icien ly, hus enabling highe le els o inno a ion.
HCs seem o inno a e in a mo e e icien way. Fu he -
mo e, spa ial au o eg essi e analyses show no signi ican
di ec , indi ec o o al e ec s o HC in ensi y on egional
inno a ion– o ei he inno a ion inpu o ou pu – which
con lic s wi h p io esea ch (e. g. Aud e sch/Feldmann
2004). Wi h ega d o inno a ion ou pu as measu ed
by pa en in ensi y, hese esul s migh indica e a shi
wi hin he inno a ion s a egy o HCs away om pu ely
o mal p o ec ion mechanisms such as pa en s owa ds
mo e mul i ace ed in ellec ual p ope y p o ec ion s a e-
gies (e. g. sec ecy) and open inno a ion app oaches. This
assump ion would be o some ex en consis en wi h he
indings o Ramme & Spielkamp (2019), who conclude
ha HCs apply a complex in ellec ual p ope y manage-
men sys em ha combines di e en p o ec ion mecha-
nisms such as pa en s, sec ecy, and complexi y o design.
Also, Vonnahme & Lang (2019) ind ha mos HCs pu sue
in e nal R&D and inno a ion ac i i ies o en ake place a
he HCs’ headqua e s. They also ind ha egional inno-
a ion coope a ion is o limi ed ele ance. In line wi h
Simon (2012), Vonnahme & Lang (2019) u he show ha
26 L. Benz e al.: Hidden champions as a de e minan o egional de elopmen
HCs o en ely on non-R&D ac i i ies such as p oduc ion
o cus ome ela ions as sou ces o inno a ion. These
ac i i ies a e no co e ed by ou wo a iables o egional
inno a ion.
In addi ion o he e ec o HC in ensi y on he dimen-
sions o egional de elopmen , we u he conside he
e ec o C-DAX i ms on a egional le el. Thus, we examine
he esul s o an impac es conduc ed ollowing he
spa ial au oco ela ion eg ession analyses, including a
compa ison o he di ec , indi ec , and o al e ec s o HC
in ensi y and C-DAX in ensi y on he dependen a iables.
The esul s should be in e p e ed wi h he unde s and-
ing ha o e laps be ween he wo g oups a e possible, as
HCs may also be lis ed in he C-DAX. The issue o i m size
should also be conside ed because C-DAX i ms end o be
la ge . Fu he mo e, he ele ance o HCs di e s ac oss
di e en spa ial ca ego ies, as a la ge HC in a small pe iph-
e al own migh possess s onge di ec impac s compa ed
o a small HC in an u ban agglome a ion (Lang e al. 2019).
In e es ingly, nei he HC in ensi y no C-DAX in ensi y sig-
ni ican ly a ec s egional expo in ensi y wi hin ei he
home o neighbo ing dis ic s. While C-DAX i ms a e no
associa ed wi h high le els o expo ac i i y pe se, his
esul is su p ising o HCs in pa icula , as hey s ongly
emphasize in e na ional expansion. Howe e , ega ding
he i s dimension o egional economic pe o mance, we
ind a signi ican di ec e ec o C-DAX in ensi y on each
o he h ee measu es: GDP pe capi a, median income,
and business ax e enues. Because we ind no signi ican
di ec e ec o HC in ensi y on GDP pe capi a, ou esul s
indica e ha C-DAX i ms con ibu e mo e o a dis ic ’s
p oduc i e s eng h han HCs. Mo eo e , al hough we ind
a signi ican o al e ec o C-DAX in ensi y on median
income, C-DAX in ensi y gene a es no signi ican spillo-
e e ec s o neighbo ing dis ic s. Thus, al hough o al
e ec s o median income a e signi ican o bo h C-DAX
i ms and HCs, only HCs gene a e a signi ican indi ec
e ec on median income. Consequen ly, employees o
C-DAX i ms seem o be less dis ibu ed ac oss dis ic
bounda ies, a elling less be ween dis ic s o wo k han
HC employees. Fo he egional economic pe o mance
dimension, i is clea ha bo h C-DAX i ms and HCs ha e
a signi ican impac on hei home dis ic , bu only HCs
gene a e signi ican spillo e e ec s, as hey posi i ely
a ec he median income o neighbo ing dis ic s. Fo he
second dimension o egional employmen , we ind no sig-
ni ican e ec s o C-DAX in ensi y on he unemploymen
a e, while HC in ensi y has signi ican indi ec and o al
e ec s on he unemploymen a e. Consequen ly, C-DAX
i ms in luence nei he hei home no hei neighbo ing
dis ic s’ unemploymen a e. None heless, simila o HC
in ensi y, C-DAX in ensi y has a signi ican di ec e ec on
he numbe o ainees pe 1,000 employees. The e o e,
C-DAX i ms, simila o HCs, con ibu e o he egional
aining o skilled wo ke s. Fo he hi d dimension o
egional inno a ion, simila o HC in ensi y, we ind no
signi ican e ec s o C-DAX in ensi y on ei he R&D in en-
si y o pa en in ensi y. Again, hese esul s a e deba able,
pa icula ly wi h ega d o pa en in ensi y. Fi ms lis ed on
he C-DAX a e ypically la ge , which is why we would ha e
expec ed hem o ely on pa en s o di e en easons.
Acco ding o Blind e al. (2006), s a egic mo i es o pa -
en ing co ela e posi i ely wi h i m size. Fo example, by
signaling success ul inno a ion de elopmen and knowl-
edge c ea ion, pa en s unc ion as help ul asse s in nego-
ia ions wi h business pa ne s.
6.2 Implica ions
Se e al implica ions o heo y and p ac ice a ise om ou
s udy. Conce ning ou heo e ical con ibu ion, we add
o he small and eme ging s eam o HC li e a u e, as we
examine he HC phenomenon on a egional le el. P e ious
esea ch on HCs has mainly ocused on he in e na ional-
iza ion (e. g. Aud e sch e al. 2018), R&D, and inno a ion
(e. g. Ramme /Spielkamp 2015, 2019) s a egies o HCs, as
iden i ied by Schenkenho e (2020). A a he small s and
o he li e a u e analyzes HCs in a geog aphic con ex ,
examining, o ins ance, he wo ldwide dis ibu ion o
HCs (e. g. Aud e sch e al. 2020; Lehmann e al. 2019) o
he ole o HCs in small owns and pe iphe al egions (e. g.
Lang e al. 2019; Vonnahme/Lang 2019). Ou s udy exam-
ines Ge man HCs a he dis ic le el. We no only show
he geog aphic dis ibu ion o HCs ac oss Ge man dis ic s
bu also analyze he impac ha HC concen a ion has on
he egional de elopmen o he dis ic s in which hey
a e loca ed. In doing so, we e iew he cha ac e is ics HCs
a e ypically associa ed wi h and examine whe he hese
cha ac e is ics ha e a isible impac a he egional le el.
The esul s o his s udy indica e ha se e al ypical HC
cha ac e is ics ha e an impac a he egional le el. The
economic success o hese i ms leads o an inc ease in
he egional median income and business ax e enues
when HC in ensi y g ows. A dec easing unemploymen
a e and a g owing numbe o ainees associa ed wi h
a highe HC in ensi y speak o he ole o hese i ms as
majo and popula egional employe s. While he signi i-
can in luence o HC in ensi y on egional pa en in ensi y
highligh s he ac ha HCs ile many pa en s, no suppo
o he s a emen ha HCs in es highly in R&D (e. g.
Ramme /Spielkamp 2019) could be ound a he egional
L. Benz e al.: Hidden champions as a de e minan o egional de elopmen 27
le el. Thus, he i m-le el cha ac e is ics o ypical HCs a e
only pa ly de ec able a he egional le el.
Consequen ly, we also con ibu e o he li e a u e on
he de e minan s o egional de elopmen as a second
heo e ical con ibu ion. P io esea ch has iden i ied spe-
ci ic i m ypes as de e minan s o di e en dimensions o
egional de elopmen . One such i m ype is he s a -up,
as he ela ionship be ween new business o ma ion and
egional employmen change is a p ominen esea ch
opic (e. g. F i sch 2008; F i sch/Mülle 2008). Fu he -
mo e, amily i ms a e ano he i m ype analyzed as a
de e minan o egional de elopmen (e. g. Basco, 2015;
Block & Spiegel, 2013). Ou s udy conside s HCs as a de e -
minan o egional de elopmen by examining he impac
o egional HC in ensi y on egional-le el a iables. Mo e-
o e , we include a a ie y o egional de elopmen dimen-
sions, namely, egional economic pe o mance, employ-
men , and inno a ion, and a se o a iables o measu e
each o hese dimensions. Applying his app oach o e s
a comp ehensi e o e iew o he impac o HCs on he
egional de elopmen o Ge man dis ic s. Consequen ly,
we add o he esea ch on speci ic i m ypes as de e -
minan s o egional de elopmen , as we iden i y HCs as
impac ul de e minan s a he egional le el. The esul s
indica e ha egional HC in ensi y signi ican ly in luences
each o he h ee dimensions analyzed. We ind a clea
impac on egional employmen , as a high HC in ensi y
educes he egional unemploymen a e and inc eases he
numbe o ainees. Fo egional economic pe o mance
and inno a ion, we unco e only a pa ial impac : a high
HC in ensi y inc eases only egional median income, busi-
ness ax e enues, and pa en in ensi y bu no egional
GDP and R&D in ensi y. Hence, HCs se e as an in luen ial
g oup o i ms pa ly de e mining se e al dimensions o
egional de elopmen .
Addi ionally, ou esul s ha e p ac ical implica ions,
especially o policy make s a he egional le el. We iden-
i y HCs as an impo an g oup o i ms a he egional le el
and highligh hei impo ance o he dis ic s in which
hey a e loca ed. Hence, HCs con ibu e o he economic
success o , employmen in, and inno a i e pe o mance o
a dis ic . Policy make s should conside he impo ance o
such i ms and keep hem om mo ing o o he loca ions.
In addi ion, HCs can also in luence so ac o s o egional
de elopmen ha a e di icul o measu e, such as he
image o a egion o wo ld ma ke leade s. Fo example, he
own We heim loca ed in Baden-Wue embe g ecen ly
applied o adding he i le own o wo ld ma ke leade s
o hei own sign (Wi scha sWoche 2021). The egional
ies o HCs also lead o he p omo ion o cul u e and spo s
and hus o an inc ease in he well-being o he local pop-
ula ion. A he same ime, he HCs hemsel es bene i
om being ac i ely in ol ed in he egional de elopmen ,
as hey may ega d hei in ol emen as an oppo uni y
o ac i ely shape hei business en i onmen (Lang e al.
2019). Fu he p ac ical implica ions a ise o he educa-
ional sec o . The s udy con i ms ha success ul and inno-
a i e i ms a e also loca ed in smalle ci ies o pe iphe al
a eas, which can o e a ac i e jobs o u u e employees
(e. g. F i sch/Wy wich 2021). In his con ex , he dual e -
ia y educa ion model is also ele an , as i allows s u-
den s o combine an academic educa ion wi h p ac ical
aining in echnological leading i ms (Schenkenho e /
Wilhelm 2020).
6.3 Limi a ions and u u e esea ch
Ou s udy has se e al limi a ions. Fi s , he c i e ia u ilized
o cons uc he sample o HCs de ia e om he ini ial c i-
e ia de ined by He mann Simon (1996). While he ma ke
leade ship c i e ion is simila , we adjus he size c i e-
ion o e enues below i e billion eu os by including a
minimum e enue le el o en million eu os. Mo eo e , we
add wo mo e size c i e ia: i m age abo e en yea s and a
minimum o 50 employees, o exclude s a -ups and e y
small i ms om ou sample. Hence, he uppe -bound size
es ic ion is simila o he ini ial de ini ion, bu we addi-
ionally use a se o lowe -bound size es ic ions. As he
hi d HC c i e ion o Simon (1996), low public awa eness,
is di icul o measu e and subjec i e, we do no include i
in ou s udy. This sho coming o HC esea ch has al eady
been poin ed ou by Schenkenho e (2020) who sees he
de elopmen o a measu e o he hidden c i e ion as a
majo a enue o u u e HC esea ch.
A second me hodological limi a ion is he dispa-
a e ime ames o he a iables used, anging om 2011
(pa en in ensi y) o 2020 (HC in ensi y). Al hough we
u ilize he ac ual da a a ailable o us, we we e o ced o
examine he in luence o HC in ensi y on dependen a ia-
bles om di e en yea s. Hence, a po en ial change in he
da a o da e canno be excluded. Ne e heless, changes a
he egional le el occu e y slowly and a e only clea ly
isible in he da a a e a longe pe iod o ime. The e o e,
we conside his limi a ion o be a he unp oblema ic
since mos o he a iables o igina e wi hin i e yea s o
each o he .
The hi d limi a ion o he s udy is i s ocus on Ge man
dis ic s. Acco dingly, he implica ions o he s udy a e
only pa ially ans e able o o he coun ies. By applying
he s udy design o o he coun ies, u u e esea ch could
inc ease he explana o y powe o ou esul s. Hence,
28 L. Benz e al.: Hidden champions as a de e minan o egional de elopmen
u u e esea ch could in es iga e he impac o local HCs
on he dimensions o egional de elopmen in he co -
esponding economy o compa e di e en coun ies in
an analysis. Indeed, p e ious s udies ha e examined
he na ional HCs o di e en coun ies in single-coun y
s udies (e. g. McKieman/Pu g Eds. 2013) and ecen ly,
Aud e sch e al. (2020) compa e se e al coun ies in a
single s udy. Ano he a enue o u u e esea ch in his
con ex would be o go beyond he headqua e le el. Von-
nahme & Lang (2019) ind ha HCs o ganize hei wo k in
a e age wi h en di e en loca ions in di e en egional
se ings o en on a global scale. Analyzing he in e play
be ween hese loca ions and he dis ibu ion o alue c ea-
ion, p oduc ion and inno a ion ac i i ies would inc ease
ou knowledge abou he in luence o HCs on egional
de elopmen o headqua e and subsidia y loca ions.
Fo he a iables employed in ou s udy, we an icipa e
di e ing deg ees o headqua e e ec s. While we expec
cen al as well as decen al e ec s o he h ee egional
economic pe o mance indica o s, he s a composi ion
o headqua e s and subsidia ies can di e (e. g. Ta ique
e al. 2006). Conce ning egional inno a ion ac i i y, we
assume ha pa en applica ions a e cen alized a he
headqua e s, while R&D ac i i ies also ake place a sub-
sidia ies (Vonnahme/Lang 2019).
Fou h, in addi ion o loca ional expansion, he uni
o analysis in e ms o he egional economic dimensions
o he s udy could be ex ended. The ocus o ou pape lies
in he h ee egional de elopmen dimensions: egional
economic pe o mance, employmen , and inno a ion.
Thus, only a pa o egional de elopmen is co e ed,
and s a emen s ega ding he e ec o HCs a e only alid
o hese h ee dimensions. To expand he explana o y
powe o hese indings, u u e s udies should include
addi ional egional de elopmen dimensions and co e-
sponding a iables. The ela ionship be ween HCs and
egional en ep eneu ial cul u e se es as a p omising
dimension o analysis, as en ep eneu ship and con-
nec ed opics a e a p ominen esea ch ield in egional
s udies. Fo ins ance, p e ious esea ch has examined he
in e play be ween egional en ep eneu ship cul u es,
egional knowledge bases, and new business o ma ion
(F i sch/Wy wich 2018). Mo eo e , S ü ze e al. (2014)
ind ha en ep eneu ial cul u e has an e ec on indi id-
ual pe cep ions o ounding oppo uni ies, which in u n
p edic s egional s a -up in en ions and ac i i y. Addi-
ionally, he ac ual deba e on en ep eneu ial ecosys ems
summa ized by Schä e & Maye (2019) could also se e as
a egional de elopmen dimension in u u e esea ch. No
only u he dimensions o egional de elopmen could
be analyzed bu also addi ional a iables o inc ease he
unde s anding o he h ee egional de elopmen dimen-
sions o ou s udy. Especially, aking a mul i-dimensional
app oach o he inno a ion dimension would be a p omis-
ing a enue o u u e esea ch. Besides he R&D expendi-
u es and he numbe o g an ed pa en s, o he a iables
such as new business o ma ion in he high- ech sec o
(Rich e 2020) o di ec inno a ion coun s (e. g. Acs e al.
2002; Makkonen/ an de Ha e 2013) can be applied. Mo e-
o e , Block e al. (2021) poin ou he impo ance o so
ypes o inno a ion, in oducing adema ks as an indica-
o o non- echnological inno a ion a he egional le el.
Al hough se e al quan i a i e s udies examine he R&D
and inno a ion s a egies o HCs (e. g. He s a e al. 2017;
Ramme /Spielkamp 2015; Vonnahme/Lang 2019), quali a-
i e and mixed-me hods esea ch could shed mo e ligh on
how hese s a egies a e shaped by egional cha ac e is ics
and ice e sa. The eby, quali a i e esea ch designs could
be used o be e unde s and he ole o HCs in egional
inno a ion sys ems and knowledge ne wo ks (e. g. Cooke
2001; F i sch/Sla che 2011) and p ecisely add ess he
ques ion o how and why HCs deli e added alue in
he egion and how hey di e om o he ( amily) i ms
in hei deg ee o locali y and egional embeddedness
(Baù e al. 2021; S ough e al. 2015). Quali a i e esea ch
app oaches a e o pa icula ele ance in he ield o eco-
nomic geog aphy because, unlike quan i a i e analyses,
hey educe conce ns abou measu emen , p o ide impo -
an con ex ual in o ma ion, and help de elop compelling
subs an i e a gumen s (Ba hel /Li 2020). Fo example,
Schoenbe ge (1991) e e s o he co po a e in e iew as a
quali a i e esea ch me hod in economic geog aphy and
Ru en (2019) uses quali a i e compa a i e analysis (QCA)
in o de o in es iga e he ela ionship be ween openness
alues and egional inno a ion.
A i h limi a ion o ou s udy is he po en ial o e e se
causali y. We assume ha HCs in luence he egional
de elopmen o hei dis ic s and hus, o example,
ensu e a highe GDP. In con as , HCs could se le in dis-
ic s ha a e al eady egionally success ul and ha e, o
example, a high GDP. Howe e , he possibili y o e e se
causali y has been mi iga ed, as he HCs in ou sample
ha e an a e age age o 92.51 yea s, and we ha e applied an
age minimum o en yea s o exclude s a -ups. Hence, no
i m in he sample ecen ly se led in i s dis ic . Ne e he-
less, he po en ial p oblem o e e se causali y canno be
comple ely excluded. To u he educe his issue, u u e
esea ch could examine his o ical da a a he egional le el
and examine he pas egional economic pe o mance,
employmen and inno a ion o cu en ly success ul dis-
ic s. Compa able analyses ha e al eady been pe o med
in p e ious esea ch. Fo ins ance, F i sch & Mülle (2008)
L. Benz e al.: Hidden champions as a de e minan o egional de elopmen 29
in es iga e his o ical da a on egional employmen and
he impac o new business o ma ion o e ime. Ano he
example is a ecen s udy on he his o ic causes behind
he spa ial dis ibu ion o inno a ion ac i i ies in Ge many
(F i sch/Wy wich 2021).
Finally, u u e esea ch is necessa y o expand knowl-
edge on he phenomenon o HCs, especially a he i m
le el. Al hough an inc easing numbe o s udies on his
phenomenon exis o da e (see Schenkenho e 2020), he
numbe o scien i ically published academic s udies in
he ield is a he limi ed (e. g. Aud e sch e al. 2018, 2020;
Johann e al. 2021; Lehmann e al. 2019). Hence, u he
esea ch is needed o be e unde s and he inne wo k-
ings o he HC phenomenon a he i m le el as well as
he ex e nal impac o his speci ic g oup o i ms. The
examina ion o he subg oup o younge HCs could be o
pa icula in e es , as hey migh ha e di e en dynam-
ics, especially in e ms o spa ial pa e ns and he s uc-
u al disad an age o mo e u al egions. In his con ex ,
he p esence o HCs migh also ha e mo e impac han
in u ban egions and be o g ea e ele ance o egional
de elopmen issues. Fu u e esea ch could ie in wi h he
p e ious wo k o Lang and colleagues (2019) o u he
examine hese aspec s. Due o hei echnological s eng h
and ex ensi e in e na ionaliza ion e o s, linking younge
HCs wi h he bo n globals concep (e. g. Baum e al. 2011,
2015; Knigh /Ca usgil 2004; Sui e al. 2012) could be a
ui ul app oach o u u e esea ch. Simila o HCs, bo n
global i ms a e associa ed wi h dis inc o ganiza ional
ea u es, ea ly in e na ionaliza ion, and supe io pe o -
mance (e. g. Knigh /Ca usgil 2004). Al hough exis ing
s udies al eady o e u he di e en ia ions o ea ly in e -
na ionalizing i ms, e. g. be ween bo n globals and bo n
egionals (Baum e al. 2015; Lopez e al. 2009; Sui e al.
2012), insigh s on globally ac i e, echnology-o ien ed
s a ups, hei cha ac e is ics and dynamics could also be
ans e able o he HC phenomenon.
Acknowledgemen s: We acknowledge help ul and cons -
uc i e commen s om Michael S ü ze and pa icipan s
o he G-Fo um 2020 as well as he 6 h In e na ional
Resea ch Fo um on Mi els and on ea lie e sions o he
manusc ip . Special hanks is also gi en o he Resea ch
Da a Cen e o he Dono s’ Associa ion o Science S a i-
s ics o p o iding he dis ic le el R&D da a. Also, we
would like o hank he edi o Sebas ian Henn and he wo
e iewe s o he ZFW o he cons uc i e commen s, which
signi ican ly imp o ed he quali y o ou manusc ip . Fu -
he mo e, we would like o hank he Dono s’ Associa ion
o Science S a is ics and he Ge man Sa ings Banks and
Gi o-Associa ion (DSGV) o suppo ing ou esea ch.
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32 L. Benz e al.: Hidden champions as a de e minan o egional de elopmen
Appendix
Figu e A1: Regional dis ibu ion o HCs in Ge many.
No es: Dis ibu ion o he absolu e numbe o HCs pe dis ic ; da ke colo s ep esen an
inc easing numbe o HCs; g ey colo ed dis ic s possess ze o HCs.
Sou ce: Own ep esen a ion, c ea ed ia Tableau.
Table A1: Ranking o Ge man dis ic s so ed by descending HC in ensi y.
Dis ic name HC in ensi y Absolu e
numbe o HCs
1 Memmingen, ci y 13.69 6
2 Kau beu en, ci y 13.67 6
3 Tu lingen 12.13 17
4 Olpe 10.39 14
5 Vulkanei el 9.90 6
6 Zweib ücken, ci y 8.77 3
7 Hochsaue landk eis 8.45 22
8 Main-Taube -K eis 8.31 11
9 Hohenlohek eis 8.03 9
10 Siegen-Wi gens ein 7.55 21
11 Schwa zwald-Baa -K eis 7.53 16
12 Cobu g, ci y 7.27 3
13 Baden-Baden, ci y 7.26 4
Dis ic name HC in ensi y Absolu e
numbe o HCs
14 Zolle nalbk eis 6.88 13
15 Wunsiedel i.Fich elgebi ge 6.83 5
16 Mä kische K eis 6.79 28
17 Ro weil 6.45 9
18 München 6.31 22
19 Obe be gische K eis 6.24 17
20 F eudenci y 5.94 7
21 Da mci y, ci y 5.65 9
22 Heilb onn, ci y 5.56 7
23 Neuwied 5.50 10
24 Göppingen 5.44 14
25 Mil enbe g 5.44 7
26 Jena, ci y 5.39 6
© 2021 Mapbox © OpenS ee Map
L. Benz e al.: Hidden champions as a de e minan o egional de elopmen 39
Table A2: Desc ip ion o a iables.
Va iable name De ini ion Da a Sou ce Ca ego y
GDP pe capi a In € pe dis ic in 2016 INKAR Dependen
Median income Mon hly sala ies o ull- ime employees subjec o
social insu ance con ibu ions in € pe dis ic in
2017
INKAR Dependen
Unemploymen a e Sha e o unemployed in he ci ilian labo o ce in %
pe dis ic in 2017
INKAR Dependen
Business ax e e-
nues
Business ax e enues in € pe inhabi an pe
dis ic in 2017
INKAR Dependen
T ainees pe 1,000
employed
Numbe o ainees pe 1,000 employees subjec o
social insu ance con ibu ions pe dis ic in 2017
INKAR Dependen
R&D in ensi y To al co po a e in e nal R&D expendi u es in sd €
pe 100,000 inhabi an s pe dis ic in 2015
Dono s’ Associa ion o Science S a is ics Dependen
Pa en in ensi y Numbe o g an ed pa en s pe 100,000 inhabi an s
pe dis ic be ween 2011 and 2015
EPO Dependen
Expo in ensi y Expo u no e in sd € pe 100,000 inhabi an s
pe dis ic in 2017
Regional Da abase o he S a is ical O ices
o he Fede al Republic o Ge many and he
Fede al S a es
Dependen
HC in ensi y Numbe o HCs pe 100,000 inhabi an s pe dis ic
in 2020
Own esea ch Independen
Popula ion densi y Numbe o inhabi an s pe km² pe coun y 2017 INKAR Con ol
Popula ion a e age
age
In yea s pe dis ic in 2017 INKAR Con ol
Fi m in ensi y Numbe o i ms pe 100,000 inhabi an s pe
dis ic in 2017
Regional Da abase o he S a is ical O ices
o he Fede al Republic o Ge many and he
Fede al S a es
Con ol
Uni e si y in ensi y Numbe o public and p i a e uni e si ies pe
100,000 inhabi an s pe dis ic in 2018
Communal Educa ion Da abase o he
S a is ical O ices o he Fede al Republic o
Ge many and he Fede al S a es
Con ol
C-DAX in ensi y Numbe o i ms lis ed in he C-DAX pe 100,000
inhabi an s pe dis ic in 2020
Deu sche Bö se AG Con ol
New business o ma-
ion in ensi y
Numbe o newly es ablished businesses pe
100,000 inhabi an s pe dis ic in 2017
INKAR Con ol
