External publication 21.04.2022 | 2022 In the eye of the beholder? Differentiating between SMEs and Mittelstand

A common fallacy is that small and medium-sized enterprises (SMEs) are the translation for Mittelstand companies. Until today, no common, widely accepted, and consistently applied understanding of what constitutes the Mittelstand exists, and related international research is consequently less coherent as well as a strong evidence-base for policy makers lacking. Most empirical research has relied on data for SMEs, taking quantitative metrics on firm size as constituent features of Mittelstand companies. The paper challenges this simplified equation of Mittelstand and SMEs and provides a first comparison of different approaches to analyze Mittelstand companies. Focusing on the criteria owner-management, firm size, and a sense of belonging to the Mittelstand, we highlight systematic differences of these approaches. Consequently, we suggest a conceptualization of Mittelstand companies that paves the way for more comprehensive research by setting the distinctive company identity based on ownership and management at the core of what constitutes the Mittelstand.