Article,

Globalization and the German model of capitalism – erosion or survival?

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British Journal of Sociology, 51 (2): 207-235 (2000)

Abstract

The German business system has been regarded as a particularly tightly coupled system, with embeddedness of even multinational companies (MNCs) in their home base as particularly deep. A study of the impact of companies' changing internationalization, if not globalization, strategies is therefore especially suited to test competing claims about their effects on the German business system. Are we experiencing an erosion of this system, an adaptation in a largely path-dependent way, or even a greater specialization and stronger crystallization of the German business system? To investigate these questions, the paper examines a small number of German MNCs in their domestic and international context. More particularly, the work focuses on whether and how their emergent globalization activities affect the reproduction or erosion of the three institutional complexes which shape the factors of production: the financial system; the innovation system; and the industrial relations system. The paper concludes that a new type of transformation - hybridization - is emerging. It is regarded as a consequence of German companies' growing integration into a global economic system.

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