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The Politics of the German Company Network
Martin Hopner, Lothar Krempel
Max Planck Institute for the Study of Societies
Project Description:
For over 100 years, the German company network was a major feature of organized corporate governance in Germany. Martin Hopner and Lothar Krempel used network visualization techniques and qualitative-historical analysis to discuss the structure, origins and development of this network and to analyze the reasons for its recent erosion.

"Network visualization makes it possible to identify crucial entanglement patterns that can be traced back historically. In three phases of network formation - the 1880s, 1920s and the 1950s - capital entanglement resulted from the interplay of company behavior and government policy. In its heyday, the company network was de facto encompassing and provided its core participants, especially the banks, with a national, macroeconomic perspective. Because of the strategic reorientation of the largest banks toward investment banking, ties between banks and industry underwent functional changes. Since the year 2000, the German government's tax policy has sped up network erosion. Vanishing capital ties imply a declining degree of strategic coordination among large German companies."

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