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“Only [...] SAP, a software-maker, is among the world’s 100 biggest companies. Apple’s $1.4trn market value is roughly that of the entire DAX 30.” Is this actu

“Only [...] SAP, a software-maker, is among the world’s 100 biggest companies. Apple’s $1.4trn market value is roughly that of the entire DAX 30.” Is this actually a problem though? The model seems to have provided some insulation from global turmoil in the past; is having enormous corporations the only important thing for a country’s economy? For as long as it doesn’t fall foul of EU laws, I can see Germans wanting to maintain this strategic advantage that other nations ignore while they’re busy chasing down every last short-term dollar.

Ididntdothis 7y ago
I think these huge companies are not good for the economy, the country or innovation. They are too powerful and they have the ability to suppress competition by just buying it up.
akira2501 7y ago
Their GDP per capita is about 17% lower than the United States, but their GDP per hour worked is only 3% lower with their average work-week being 22% shorter than in the United States. So, from a very narrow and short-sighted point of view.. they're just as productive as we are, but they have 1/3 our population and they work fewer hours which limits their ability to compete in the global marketplace. For German companies that serve only domestically or within the EU, I doubt the councils are a problem or even an impediment.. but for companies that want to operate globally, I imagine it does reduce their ability to compete. I guess the question for Germany is, do they want to sacrifice these broader protections and slightly better working conditions in order to improve profits for a handful of companies that can actually take advantage of it? I hope not, but it looks like the groundwork is already being laid for a campaign to change this.
- kamarg 7y ago
  I wonder if the question is really, do the giant corporations that want to compete globally have as much ability to get laws passed in Germany as they do here in the US? If they do, you can bet that those protections and working conditions will start looking a lot more like what we see in the US even if it's only a benefit for a fraction of a percentage of people in Germany and a detriment for all the rest.
- fulafel 7y ago
  It sounds to me like Germans are doing better than US people in competing on the global marketplace? Shorter hours is a valuable advantage.
  - hef19898 7y ago
    More vacation, too. 28-30 days plus bank holidays being the norm. And all the social security and health care stuff.
    - indemnity 7y ago
      German parental leave is pretty good too, I believe even the husband can take two months without an issue, and the wives can take a year at 60% pay, and two years more after that.
      - hef19898 7y ago
        Both can take either the two months or the two years. It's usually women who take the longer period. But yeah, socially Germany isn't that bad!
- thomasdullien 7y ago
  The "reduces their ability to compete"-argument does not hold water considering the data, though. One useful measure of a countries competitiveness is the size of their exports (because it implies that there is a lot of foreign demand for the products from that country), or in their "exports-to-population" ratio. If you check https://tradingeconomics.com/germany/exports https://tradingeconomics.com/germany/exports you can see that Germany exports about EUR 112bn worth of goods per month, on a population of about 83 million, about EUR 1350 per head. For comparison: Canada exports about 49bn CAD per month, on a population of 38m, for approximately 1297 CAD per head. The US exports about 208bn USD per month, on a population of 327m, for approximately 638 USD per head. If anything, the big weakness of the German economy is not that it is not competitive enough, the big weakness of the German economy is a lack of domestic consumption due to not much of the money actually reaching workers pockets; this is a result of a fairly aggressive wage stagnation that set in in the 2000s.
  - jnordwick 7y ago
    I've never heard of anybody using exports as development metric. It's usually just a sign of developing country with cheap labor. > wage stagnation that set in in the 2000s. And imagine that. Seems to fit the low wage story pretty well.
    - thomasdullien 7y ago
      When speaking about "competitiveness", what measures aside from current account balance and share of global exports is better suited? Not to be snarky, but you can't do any reading in economics about competitiveness and not encounter the current account balance (which is exports - imports): https://www.economicshelp.org/blog/6701/trade/importance-of-current-account-deficit/ https://www.economicshelp.org/blog/6701/trade/importance-of-...

Ididntdothis 7y ago

I think these huge companies are not good for the economy, the country or innovation. They are too powerful and they have the ability to suppress competition by just buying it up.

akira2501 7y ago

Their GDP per capita is about 17% lower than the United States, but their GDP per hour worked is only 3% lower with their average work-week being 22% shorter than in the United States. So, from a very narrow and short-sighted point of view.. they're just as productive as we are, but they have 1/3 our population and they work fewer hours which limits their ability to compete in the global marketplace. For German companies that serve only domestically or within the EU, I doubt the councils are a problem or even an impediment.. but for companies that want to operate globally, I imagine it does reduce their ability to compete. I guess the question for Germany is, do they want to sacrifice these broader protections and slightly better working conditions in order to improve profits for a handful of companies that can actually take advantage of it? I hope not, but it looks like the groundwork is already being laid for a campaign to change this.

kamarg 7y ago
I wonder if the question is really, do the giant corporations that want to compete globally have as much ability to get laws passed in Germany as they do here in the US? If they do, you can bet that those protections and working conditions will start looking a lot more like what we see in the US even if it's only a benefit for a fraction of a percentage of people in Germany and a detriment for all the rest.
fulafel 7y ago
It sounds to me like Germans are doing better than US people in competing on the global marketplace? Shorter hours is a valuable advantage.
- hef19898 7y ago
  More vacation, too. 28-30 days plus bank holidays being the norm. And all the social security and health care stuff.
  - indemnity 7y ago
    German parental leave is pretty good too, I believe even the husband can take two months without an issue, and the wives can take a year at 60% pay, and two years more after that.
    - hef19898 7y ago
      Both can take either the two months or the two years. It's usually women who take the longer period. But yeah, socially Germany isn't that bad!
thomasdullien 7y ago
The "reduces their ability to compete"-argument does not hold water considering the data, though. One useful measure of a countries competitiveness is the size of their exports (because it implies that there is a lot of foreign demand for the products from that country), or in their "exports-to-population" ratio. If you check https://tradingeconomics.com/germany/exports https://tradingeconomics.com/germany/exports you can see that Germany exports about EUR 112bn worth of goods per month, on a population of about 83 million, about EUR 1350 per head. For comparison: Canada exports about 49bn CAD per month, on a population of 38m, for approximately 1297 CAD per head. The US exports about 208bn USD per month, on a population of 327m, for approximately 638 USD per head. If anything, the big weakness of the German economy is not that it is not competitive enough, the big weakness of the German economy is a lack of domestic consumption due to not much of the money actually reaching workers pockets; this is a result of a fairly aggressive wage stagnation that set in in the 2000s.
- jnordwick 7y ago
  I've never heard of anybody using exports as development metric. It's usually just a sign of developing country with cheap labor. > wage stagnation that set in in the 2000s. And imagine that. Seems to fit the low wage story pretty well.
  - thomasdullien 7y ago
    When speaking about "competitiveness", what measures aside from current account balance and share of global exports is better suited? Not to be snarky, but you can't do any reading in economics about competitiveness and not encounter the current account balance (which is exports - imports): https://www.economicshelp.org/blog/6701/trade/importance-of-current-account-deficit/ https://www.economicshelp.org/blog/6701/trade/importance-of-...