German family capitalism in the 21st century: Patient capital between bifurcation and symbiosis

Abstract

Family firms dominate the German economy statistically, employing over half of all employees in the private sector. Many German family firms were quiet beneficiaries of globalization and grew substantially in the past decades. Consistent with the notion that patient capital requires certain vectors of 'engagement' to ensure it functions in ways aligned with the interests of key stakeholders, we examine how engagement works at the local level of family firms embedded in their home communities as well as at the national level: within Germany's 'coordinated' variety of capitalism the family sector maintains deep economic ties with the nonfamily sector (symbiosis) at the same time that it grows more institutionally distinct from it (bifurcation).