From managed to market capitalism? German finance in transition

Abstract

Deregulation, technological change, and the integration of markets increase the competitive pressures on forms of national and sectoral governance. The heart of the issue is whether the continental, consensus‐oriented model of capitalism is gravitating towards the Anglo‐Saxon, market‐oriented model. This essay examines the heuristic value of this convergence thesis, using the German financial sector and its relations to industry and government as a case in point. It will be argued that while the institutional restructuring that is taking place within Germany reflects characteristics of Anglo‐Saxon capitalism, institutional hurdles, such as federal structures and the veto power of certain societal lobbies, have thus far prevented such a convergence throughout the entire system.