Institutional Differences Between the British and German Economic Models: Corporate Sector and Labour Market
AbstractThe aim of this paper is to compare some of the significant institutional differences between the British and German economic models. This paper builds on a methodological framework developed by institutional economics. Comparative research carried out in this paper focuses on three institutional fields in both market economies: control of management, corporate finance and labour market. In the UK, we can find evidence suggesting an important role of the market for corporate control, exerting pressure on management to deliver good corporate performance. On the other hand, in Germany, we find an important role of banks that exert direct control over firm´s management and its strategic decision-making. As for corporate finance, British companies tend to make use of highly liquid financial markets and short-term finance, whereas German companies form strategic partnerships with banks which provide them with long-term credits. Lastly, labour market in the UK is more flexible compared to German labour market as its labour law favours short-term contracts, unemployment benefits are less generous and the power of trade unions to protect workers is limited.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by University of Economics, Prague in its journal Acta Oeconomica Pragensia.
Volume (Year): 2012 (2012)
Issue (Month): 1 ()
Postal: Redakce Acta Oeconomica Pragensia, Vysoká škola ekonomická v Praze, nám. W. Churchilla 4, 130 67 Praha 3
Find related papers by JEL classification:
- P10 - Economic Systems - - Capitalist Systems - - - General
- P51 - Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Goergen, M. & Manjon, M.C. & Renneboog, L.D.R., 2004.
"Recent Developments in German Corporate Governance,"
Discussion Paper, Tilburg University, Center for Economic Research
2004-123, Tilburg University, Center for Economic Research.
- Goergen, Marc & Manjon, Miguel C. & Renneboog, Luc, 2008. "Recent developments in German corporate governance," International Review of Law and Economics, Elsevier, Elsevier, vol. 28(3), pages 175-193, September.
- Goergen, M. & Manjon, M.C. & Renneboog, L.D.R., 2004. "Recent Developments in German Corporate Governance," Discussion Paper, Tilburg University, Tilburg Law and Economic Center 2004-014, Tilburg University, Tilburg Law and Economic Center.
- John Armour & Simon Deakin & Suzanne J. Konzelmann, 2003. "Shareholder Primacy and the Trajectory of UK Corporate Governance," ESRC Centre for Business Research - Working Papers, ESRC Centre for Business Research wp266, ESRC Centre for Business Research.
- John Armour & Simon Deakin & Suzanne J. Konzelmann, 2003. "Shareholder Primacy and the Trajectory of UK Corporate Governance," British Journal of Industrial Relations, London School of Economics, London School of Economics, vol. 41(3), pages 531-555, 09.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Vaclav Subrta).
If references are entirely missing, you can add them using this form.