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Gustav von Schmoller-Vorlesung, 5. Konferenz für Sozial- und Wirtschaftsdaten: Die Internationalisierung deutscher Banken und Unternehmen aus Perspektive der Mikrodaten
Journal of Contextual Economics – Schmollers Jahrbuch, Vol. 131 (2011), Iss. 3 : pp. 431–453
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Claudia M. Buch, Universität Tübingen, Wirtschafts- und Sozialwissenschaftliche Fakultät, Mohlstr. 36, 72074 Tübingen.
Abstract
Economic performance in Germany is largely determined by external developments. Exports of German firms contribute a significant share to total production, German banks hold a large share of foreign assets, and many German firms hold foreign affiliates abroad. This international exposure brings costs and benefits. The German economy benefits from access to international markets for its firms and from having access to diversified international investment portfolios. But there are also potential costs in terms of an exposure to foreign shocks – as the recent crisis has forcefully shown –, and many fear that German jobs are „exported" abroad through foreign direct investment (FDI). Recent literature has shown that analyzing the patterns of internationalization requires an analysis of the sorting and selection of firms into foreign markets. This paper reviews the literature on firm- and bank-level globalization in Germany. It is shown that size effects matter significantly for both, banks and firms – only the largest and most productive firms and banks are active abroad. In addition, financial constraints serve as a barrier to entry into foreign markets. There is little evidence for negative employment effects of FDI, while the beneficial effects of foreign banking activities in terms of improvements in the risk-return-trade off are less clear cut.