The rise of interlocking directorates in imperial Germany

Through representation on company boards, German universal banks are thought to have monitored and advised firms, thus spurring industrial growth. This article presents new evidence that interlocking directorates proliferated only in the last decade of the nineteenth century and, therefore, cannot be viewed as an engine of German industrialization. Finn-level analysis further undermines traditional views about the role of formalized bank relationships as devices for monitoring debt, providing consultancy services, or signalling firms' quality to equity markets. The findings suggest, instead, mat interlocking directorates arose from structural changes in the German economy at the rum of the century.