9 - Conclusion

Summary

German industrialization has always attracted the attention of scholars and policy makers – even as it was under way – because it seemingly progressed through the development process with great speed and success. In striking an appealing balance of public and private control, the German system created what appears to have been particularly effective and efficient political, economic, legal, and financial institutions. This sense of beneficial institutional and systemic design continues to influence modern thinking about the best ways to promote economic advancement and prosperity, particularly in light of the late-twentieth-century political and economic transitions from communism to capitalism, as well as the broader post–World War II goals of achieving industrial development in the many economically disadvantaged regions of the world. Even on the theoretical front, the German case has inspired numerous ideas about modeling the role of financial institutions, corporate governance relationships, and their impact on firms, industries, and the economy as a whole.

With this substantial foundation of past literature and thinking in mind, the first chapter of this book laid out three primary motivations for undertaking an in-depth, historical study of the German corporate finance and governance system: first, gaining a clearer understanding of Germany's rise to financial and economic power; second, using the empirical evidence of the German case as a means of informing and refining general theories of financial intermediation and economic growth; and third, using that historical knowledge and experience to draw out lessons for financial policy today.