Towards the Americanization of European Finance? The Case of Finance-Led Accumulation in Germany

Abstract

The German financial system has often been described as a bank-based system — to be contrasted with the market-based systems of the United States or Great Britain. Social scientists have conceived this bank-based financial system as a cornerstone of the so-called ‘model Germany’. In the past, it had often been admired by external observers because the long-term relations between banks and industrial firms and the prevalence of ‘patient capital’ not oriented towards short-term profit maximization seemed to be the basis for competitive strategies focused on innovation and product quality, enabling high growth rates and a top position in the international division of labour (see Zysman 1983; Edwards and Fischer 1994; Deeg 1999). Even during the 1970s and 1980s, when the exhaustion of the Fordist regime of accumulation became apparent and the pressure for restructuring mounted, Germany seemed to do relatively well in comparison to the Anglo-Saxon countries. The ‘intellectual and moral turnaround’ announced by the Christian-Democratic Chancellor Helmut Kohl in March 1983 did not immediately bring such radical change as ‘Thatcherism’ in Britain or ‘Reaganomics’ in the USA. Many observers stressed the continuity of ‘model Germany’.