The Impact of the German Corporate Tradition on Formation of Foreign Economic Support System for Business

DOI: 10.20542/0131-2227-2019-63-11-56-65

A. Ivanova (,
Institute of Europe, Russian Academy of Sciences (IE RAS), 11, build. 3, Mokhovaya Str., Moscow, 125009, Russian Federation 

Abstract. The German system of foreign economic activity support is traditionally divided into a number of components, including financial and functional measures (direct and indirect support, respectively). It is important to note, that indirect incentive mechanisms play a significant role in economic policy. In considering an export-supporting system, indirect support is no less important than direct government funding. The article analyses the formation of German institutions for business functional supporting. Special attention is paid to the concept of so-called “Three pillars of foreign economic support”. The author identifies a number of fundamental characteristics that could be the cause of the institutional evolution of business environment, and comes to a conclusion that the developed elements of corporatism, such as the institutionalization of interest groups and forms of their will as well as enhancing cooperation between private and public institutions, has played an important role in the future design of the whole system. This contributes to formation of various framework conditions in which economic players acquire greater resources allowing them to independently determine and reproduce the best practices in the field of international activity. The development and, accordingly, the complexity of business environment, as also wide communication capabilities, are the key to its resource base and potential for building an appropriate institutional system. The main principles of the foreign economic support system, formed under the influence of corporate tradition are also identified: 1) delegation of sovereign tasks to private economic agents; 2) the desire of the state to establish effective communication chains between all existing subjects of economic relations; 3) involvement of the largest possible number of stakeholders in the information exchange (in the process of elaboration, implementation and decision-making, in the exchange of economic information between private and public entities). So, policies that stimulate the corporate relations (or special interest groups) become a bridge between economic interests and state authorities, allowing the institutional system to determine the direction of its advancement. 

Keywords: Germany, business unions, corporatism, interest groups, social market economy, Three Pillars Concept 


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For citation:
Ivanova A. The Impact of the German Corporate Tradition on Formation of Foreign Economic Support System for Business. World Eonomy and International Relations, 2019, vol. 63, no. 11, pp. 56-65.

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