Varieties of Family Capitalism: Results of a Comparative Project on Germany and the United States
Family businesses play an important economic role on both sides of the Atlantic. In addition to some parallels, there are also significant differences between Germany and America in terms of corporate and family cultures as well as the institutional environment for, and the lifespan of, family businesses.
This project has investigated the differences and similarities between the development of family businesses in Germany and the United States from the mid-19th to the early 21st century. It analyses the causes and effects of the different corporate landscapes using a long-term, historical view. The focus is on the position of family companies in the two countries and the legal, structural, political and cultural environments.
At a general level, the study concludes that the institutional fabric in Germany favored the development of multigenerational family businesses, while that of the United States tended to promote the dynamism of young companies, whose owners sold off all or part of them after relatively short periods of ownership. German family businesses are, on average, much older than their US counterparts and more often focus on achieving intergenerational continuity.
The study has among others looked in detail at the history of inheritance law, which for a long time was substantially less advantageous for family-business owners in the United States than for their German counterparts. It has also compared the financing models and the political environment of family firms in both countries.
