A proliferation of public investment banking can be observed in the EU, targeting the growth gap between restrictive fiscal policy and expansionary yet inefficient monetary policy since the beginning of the Eurozone crisis. Existing institutions such as the European Investment Bank (EIB) and the Kreditanstalt für Wiederaufbau (KfW) have expanded their activities towards crisis-struck countries and new institutions are being created. A so-called “Institution for Growth” is to be established in Greece with significant financial and technical involvement of the KfW. France has created a similar institution with the Banque Publique d’Investissement (BpI), for which the German KfW – according to e.g. Prime Minister Ayrault - serves as an institutional model. This paper analyses the establishment of the BpI represents as an adaptation of the German KfW model. Its argument is that the creation of the BpI is part of an attempt to adapt the German growth model in France with a Mittelstand à la française at its core. But institutional complementarities of these forms of capitalism hinder the adaption of the German growth model in France. Framed by an institutionalist policy transfer approach, I will conduct careful process-tracing of the BpI establishment.
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