I live in Spain and during the month of August almost everything shuts down for holiday. What doesn't shut down is open to cater to the large number of tourists visiting from other parts of the world.
Does Germany practice a similar 'shut down' during the month of August?
No, not at all. In fact all the school vacations in Germany are staggered throughout the summer, so summer vacation in Berlin will be at a different time than in Munich or in Frankfurt, for example. This is tourist season, it would be silly to shut down when there is money to be made.
http://www.holidays-info.com/School-Holidays-Germany/2009/school-holidays_2009.html
