chapter  6
German banks abroad before 1914
Pages 21

Introduction World trade during the last three decades before the outbreak of the First World War was characterized, among other things, by a rapidly-growing share for Germany, and to a lesser extent, the United States, whereas Britain's part, so dominant around the middle of the nineteenth century, gradually shrank, remaining nevertheless ahead of all trading nations. If we refer only to the one-and-a-half decades before 1914 for which statistics are best, we can base ourselves on S.B. Saul's observation that:

Between 1899 and 1913 Britain's share of world trade in manufactures fell from 34 per cent to 31 per cent, whilst that of Germany rose from 23 to 27.5 per cent and that of the United States from 11.5 per cent to 13 per cent.)

We can go further back and look at Germany's exports in the European total according to Paul Bairoch's estimates (keeping in mind, of course, that all kinds of goods are included here and that the development is therefore much less spectacular than if we had looked at manufactures only): in 1860 they amounted to 18.4 per cent, in 1890 they had even diminished to 17.4 per cent, but in 1910 they had finally risen to 20.4 per cent, whereas Britain's share had gone down continually during the entire period from 29.8 per cent in 1860 to 26.6 per cent in 1890, and to 23.7 per cent in 1910.2

One of the reasons for the rapid growth of German industry since the 1880s could have been the contribution of German banking in its 'mixed' form: one which combined short-term and long-term credit and established close ties between individual industrial firms and credit institutions. Many observers, for instance Rondo Cameron in 196P and only recently Richard Tilly,4 did not reach any clear-cut conclusions in this regard. They