Fleeing or Exporting the German Model? — The Internationalization of German Multinationals in the 1990s

Abstract

This article examines the question of whether German companies flee or export the German model. On the basis of data from the Deutsche Bundesbank and mergers and acquisitions data, the article argues that job exports from Germany in the last fifteen years have been rather marginal. Thus, German multinational corporations (MNCs) do not flee the German model to the extent suggested by many critics of Germany as a production location. In addition, the paper draws on 13 case studies of German investments in Hungary to help understand the extent to which German MNCs export the German model. This case study evidence indicates that German MNCs do not attempt to completely transfer all aspects of the German production model, as some proponents of institutionalist political economy approaches maintain. The German labour relations model, in particular, is only selectively transferred.