Against the Mainstream: Nazi Privatization in 1930s Germany

Abstract

The Great Depression spurred state ownership in Western capitalist countries. Germany was no exception; the last governments in the Weimar Republic took over firms in diverse sectors. Later, the Nazi regime transferred public ownership and public services to the private sector. In doing so, they went against the mainstream in the Western capitalistic countries, none of which systematically reprivatized firms during the 1930s. Privatization in Nazi Germany was also unique in transferring to private hands the production of public services previously delivered by government. Both the firms and the services transferred to private ownership belonged to diverse sectors. Privatization was part of an intentional policy with multiple objectives and was not ideologically driven. As has been usual in recent privatizations, particularly within the European Union, strong financial restrictions were a central motivation. In addition, privatization was used as a political tool to enhance support for the government and to reinforce support to the Nazi Party.

Keywords: Privatization, Public Enterprise, Nazi Economy, Germany.

JEL Classification: G38, L32, L33, N44