The German system of codetermination contributes to the entrenchment of labor. We show in a two-period model of project choice that entrenched labor leads to underinvestment and overstaffing. We provide empirical evidence that German firms subject to codetermination with equal representation of...

Over the last few decades, the co-operative banking sector in Germany has steadily increased its market share at the expense of other types of banks. This outcome is surprising from the standpoint of traditional economic thinking about co-operatives, which suggests that they are most appropriate...

Corporate governance practices differ greatly in the United States and Germany. This paper describes the main institutional features of the German corporate governance system, focusing on universal banks and codetermination. The paper also summarizes existing empirical evidence that has...

This article describes the most important corporate governance practices in contemporary Germany. These practices include a prominent role for universal banks, other large financial and non-financial firms, and employees through a system known as codetermination. While some similarities exist,...