Finance capitalism in industrializing autocracies: Evidence from corporate balance sheets in imperial Germany and Russia

Russia and Germany both industrialized later than England and the United States, and both countries retained authoritarian autocracies until World War I. On the basis of a large collection of firm-level balance sheets, this paper presents new evidence revealing the likely impact of these systematic disparities on emerging industry's access to capital. Contrary to the standard 'economic backwardness' and 'law and finance' literatures, we argue that differences in financing between Russian and German corporations were consistent with authoritarian control of corporate entry as well as Russia's agricultural economy and overall lower level of economic development.