|Business and Economic|
Papers Presented at the BHC Annual Meeting
William J. Hausman
College of William and Mary
College of William and Mary
Stephen B. Adams
Becoming Silicon Valley: Exogenous Factors in the Development of a High-Tech Region
What was the nature of Silicon Valley during its formative years, before 1975? To what extent can we attribute the rise of the Valley and its capital, control, and ideas to indigenous, as opposed to exogenous, factors? To explore these questions, this paper reviews three stages in Silicon Valley’s development: regional disadvantage (1909-1940); achieving critical mass (1940-1960); and establishing entrepreneurial infrastructure (1960-1975). Based on both qualitative and quantitative sources, I conclude that we can attribute much of the Valley’s pre-1975 development to factors exogenous to the region. This means:
The First Labour Government's New Start for Manufacturing, Employment, and Social Security in New Zealand, 1935-1949
New Zealand’s first Labour government swept to power in 1935 with ambitious plans for recovery after years of depression. Its promises were similar to those of other national governments in the United States, Britain, and Europe, which also accepted responsibility for economic wellbeing. Labour used state powers to boost local industry, thereby creating employment and conserving precious foreign exchange. But its real challenge was smoothing out sharp changes in external commodity prices to achieve internal price stability, and somehow sharing out through paid employment the "national" income earned by a small sector and a few exports. Labour took the lead in economic regulation, curbing competition and concentrating industry to avoid costly duplication of plant, equipment, or expertise and to ensure "stabilisation." But expansionist policies and prosperity brought strong demand from industry and public works. Large volumes of imports and sharply fluctuating prices for meat and dairy products on the London market caused a foreign exchange crisis in 1938. Threats of balance of payments crises recurred throughout the postwar years, undermining long-term aims for local industry. Labour’s legacy lived on after 1949 as new governments also tried to maintain a commitment to a full-employment welfare state.
Shaped by Risk: The American Fire Insurance Industry, 1790-1920
Fire insurance represents one of the first institutional approaches to risk management in the United States. Between 1790 and 1920, the American fire insurance industry recast the unmanageable physical hazard of fire as a financial risk. In the formative years of the industry, catastrophic fires repeatedly bankrupted waves of insurers, confronting the survivors with the need for strategic and structural adaptations. Their responses included geographical diversification, and the establishment of a cooperative regime. Ultimately, insurers were forced to adapt to state rate regulation. Their strategies served to assure long-term stability for the industry as a whole at the expense of individual firms' pursuit of short-term gains.
Dalit Baranoff and David Kirsch
"My Boss Rocks": Exceptionalism in the Dot-Com Workplace
What was it like to work in a dot-com firm during the boom years of the late 1990s through early 2000? Did everyone really believe that their stock options would make them millionaires before they turned 30? Did they all take their dogs to work at their hip, open-floor-plan offices with foosball tables? The Dot-Com Workers Survey (developed by the authors) collects workers’ own accounts through an on-line oral history survey in order to create a fuller picture of the dot-com workplace. Our initial findings lead us to believe that dot-coms were exceptional workplaces, but not necessarily for the reasons that contemporary observers thought. Former employees describe exciting, dynamic work environments, where money, perks, and stock options were only a part of the appeal. At least as important were their relationships with fellow employees, their feelings of autonomy within the work environment, and their sense that they were doing something new and exciting and making a differencedespite working at companies that, by the workers’ own retrospective accounts, often suffered from poor strategy and bad management.
A Genealogy of the Corporate Person: Articulating Sovereign Power and Capital
My dissertation traces a genealogical link between corporations and sovereign power. It explains how corporations have exercised prerogatives of sovereignty, such as territorial control, monopolies on the legitimate use of force and violence, and what the philosopher Giorgio Agamben has termed the power to decide "the originary inclusion of the living in the sphere of law"in short, the power over life and death. This relationship, however, has been displaced over the nineteenth and twentieth centuries into a depoliticized and deterritorialized sphere of the private economy. To understand how it occurred, the dissertation investigates a series of "socio-legal technologies." These technologies, like the charter, the share, the natural entity theory of corporate personhood, and extraterritorial corporate law, each reframed what the corporation was, what powers it possessed, what physical spaces it could occupy, how it would act, and on whose authority. Examining these technologies shows that corporations are an effect of law’s iterative statements and the link between capitalist accumulation and specific forms of governmental power.
Elite Slaveholding Women and the Building of the Cotton Kingdom
How did elite slaveholding women contribute to the building of the Cotton Kingdom? Most historians answer this question by looking to white women’s roles as plantation mistresses. Though this position was essential to the operation of Southern plantations, some female slaveholders assumed a role of even more economic consequence on their families’ estatesthat of the plantation manager or agent. Although usually performed by white men, plantation management was often the task of absentee planters’ wives. Through an examination of the managerial structure of Richard Thompson Archer’s plantations in antebellum Mississippi, this paper considers the role of managers and the unique position of female managers within the administrative hierarchy of southern slave plantations. Ann Archer’s relative permanence on her husband’s home estates, familiarity with their operation, and personal interest in their success, enhanced her administrative potential and Richard’s reliance on her managerial skills.
Regional Specialization and Industrial Renewal: Medical Devices in Massachusetts
The American medical devices industry has grown at a rate of approximately 8% per year over a 25-year period. Massachusetts is near or at the top in many regional specialization indicators such as enterprise location quotient and exports. We apply vTHREAD (Techno-Historical Regional Economic Analysis Database), a longitudinal, historical database of approximately 60,000 public and private, high-tech producers classified by a finely granulated taxonomy to four related issues. First we decompose growth in the medical devices cluster to reinvention within companies in the form of developing new products, processes and technologies; to the entry of new companies; and to companies migrating from other sectors, regions, and countries. We focus in particular on the important role played by foreign-headquartered companies in the development of the cluster. Second, we characterize the business organization of the rapidly growing firms and find that few, if any, fit the Chandlerian description of a modern, professionally managed business enterprise. Third, we characterize the distinctive technological heritage of Massachusetts that contributed to the emergence of a successful medical devices industry. Fourth, we compare the distinctive specialization patterns of the medical device industries of Massachusetts and Minnesota.
Mansel G. Blackford
Tourism, the Environment, and the Military: The Case of Guam, 1962-2002
My paper examines relationships among military rule, the development of tourism as a form of economic development, environmental changes, and the rights of indigenous people (the Chamoru or Chamorro) on Guam beteen 1962 and 2002. More specifically, my paper examines the impacts the brown tree snake, an alien specie accidentally introduced to Guam by the U.S. Navy after World War II, has had on the evolution of tourism, how Chamoru and other Guamanians have viewed their identities, and the flora and fauna of Guam. The brown tree snake is currently threatening to spread throughout the Pacific, including, among many places, the Hawaiian Islands, with potentially devasting effects. This paper is part of a much longer work I have underway on how people in American-controlled parts of the Pacific have dealt with economic-development and environmental-protection issues since World War II.
Regina Lee Blaszczyk
Tales of Styling and Forecasting: The Du Pont Company and the Color Revolution
During the 1920s, American business practice underwent major changes as companies competed in a "buyer's market." Firms experimented with strategies for stimulating sales: installment credit, mass advertising, product styling, and color merchandising. Among these strategies, historians know the least about color. This paper examines color styling and forecasting at E. I. du Pont de Nemours & Company between 1925 and 1935. Then, the Du Pont Company hired professional colorists to manage Duco Finish, a quick-drying lacquer developed for the auto industry. As fashion intermediaries, colorists brought important new skills to Du Pont, helping the chemical giant to manage aesthetic risk. More important, they paved the way for the professionalization of design in Detroit, prefiguring the work of high-profile stylists like Harley J. Earl.
Multinationals and Politics in Latin America: The Case of Standard Oil Co. (New Jersey) in Colombia, Venezuela, Mexico, and Argentina
In the 1920s the Standard Oil Company faced the hostility of the left-wing Mexican Revolutionary government, which eventually expropriated the company’s properties in 1938. As nationalist rhetoric increased before 1938 in Mexico, Standard Oil explored new fields in Colombia and Venezuela, countries ruled by foreign business-friendly, right-wing governments who gave very generous concessions to foreign multinationals. In contrast to these two countries and revolutionary Mexico, consumer countries like Chile and Argentina tried to establish strong control over foreign oil capital without making their countries a threat to multinationals. This paper compares Standard´s reactions to different kinds of nationalism in these Latin American countries and the way it adapted to the variety of uncertain scenarios.
Slave Manumissions: A Mechanism of Plantation Management in the Old South
In 1816, whites who wanted to remove blacks from the United States founded the American Colonization Society (ACS). Soon thereafter, the ACS established the colony of Liberia in West Africa as a place for black settlement. By 1860, 560 slaveholders had sent, collectively, 6,000 bondpersons to Liberia. This paper explores the ideology and intentions of "ACS manumitters." Philosophical, religious, and economic forces prompted ACS emancipators to question slavery’s morality and viability. They consequently concocted time-consuming manumission programs. The emancipators announced that the schemes would prepare slaves for freedom in Liberia, but they also assumed that the projects would serve their own intereststhat the lure of liberty would coax obedience and loyalty from bondpersons. To them, manumission was an absolutely necessary, morally upright, and economically astute mechanism of slave management, an administrative strategy that could put one’s conscience at ease, one’s finances in order, and one's slaves in their place.
Mark Carlson and Kris James Mitchener
The Bank of America and the Transformation of Banking in California
This paper examines the impact of branch banking on competition and the stability of banking systems. Since California was a pioneer in the development of intrastate branching, we use its experience during the 1920s and 1930s to examine the effects of the expansion of large-scale branch banking networks. As this effort was led by the Bank of America, our paper provides a special emphasis on this institution. Using a new database of individual bank balance sheets and branch establishment, we examine the characteristics that made a bank a more likely target of a takeover, how competing banks responded to the presence of branch banks, and how branching networks affected the probability of survival during the Great Depression. We find that well-capitalized banks displaying characteristics of more profitable institutions were the most likely merger targets. Banks that had to compete with branches changed their operations in ways consistent with efforts to increase efficiency and profitability. We then find that these banks were more likely to survive the Depression than banks that did not face such competition. Thus, our paper provides evidence that branch banking increased the stability of the banking system by increasing competition and forcing banks to become more efficient.
"The Company Could not Take Complete Advantage of its Bigness": Managerial Culture and the Pennsylvania Railroad’s 1955 Corporate Reorganization
The 1955 reorganization of the Pennsylvania Railroad (PRR) illustrates that firm’s periodic attempts to reinvent its corporate identity. One such transformation occurred in 1920, when the PRR joined Lines East and Lines West into a "Three Region" organization. The Railroad’s "Nine Region" plan, which took effect on November 1, 1955, created an even more decentralized organization, with each Region controlling operations, marketing, real estate, and engineering. PRR president James Symes is widely credited with personally advocating the 1955 reorganization, but the management consulting firm Robert Heller and Associates played an even more significant role. The new organization merely exacerbated the PRR’s problems by tripling the PRR’s overhead at a time of declining revenues and plummeting employment. The company’s marketing efforts suffered, since the people who solicited business and those who ran the trains reported to two separate lines of authority. The PRR reverted to the old Three Region plan in 1964.
How Financial Institutions Affect Economic Change: Evidence from the Transportation Sector, 1900-1939
This paper explores relationships between the investment behavior of private and public financial institutions and changes in the structure of the transport sector of the United States, from 1900 through the Great Depressiona period during which the hegemony of railroads was significantly eroded by the emergence of highway-based transport. Primary source data are presented showing changes in the amount and composition of capital (debt and equity) used to finance rail development, 1900-1939, and, concomitantly, the amount of debt and equity held by private financial institutions (banks and insurance companies) in their asset portfolios. This data shows that rail corporations raised more capital through issuance of debt than equity, and that portfolios of private financial institutions were heavily weighted with rail loans. Combined with bank reports and records of receivership reorganizations, the evidence shows that the investment behavior of private financial institutions was directly related to the decline of rail transport and, indirectly, to the rapid rise, 1900-1939, of highway transport as a competitor to rail. This paper also discusses the rise of the federal government as a major financial intermediary, particularly during the 1930's, when the Reconstruction Finance Corporation (RFC) took over much of the rail debt of both financial institutions and rail corporations. The investment behavior of the RFC also directly influenced restructuring of the U.S. transport sector.
The Natural Case for Integration: The Limits on Business Formation in Western Montana, 1880-1910
Between 1880 and 1910, Butte, Montana, underwent the most significant transformation in its short existence as a mining region. It changed from being a multi-company, multi-product industrial mining town to becoming part of a horizontally and vertically integrated international company. This paper looks at this historical transition by examining the role that natural resources played in shaping the institutional development of the mining businesses of the region and eventually as a driving force behind the argument for consolidation of mining and smelting in Butte. I argue that an unusual combination of abundance and scarcity of natural resources led to intense, but avoidable, competition in the forests, in the mines, and in the courts. The unprecedented increase in output that both resulted from and created these conditions led as well to a deteriorated environment in and around Butte city. Attention to the relationships that developed around Montana's natural resources suggests that technological innovation and market demand may not have been the most important variables to explain the pattern of modern business evolution in the western primary metals industry; at least in Butte, natural limits and local factors may have been much more influential.
Diane DeBlois and Robert Dalton Harris
Geographic Integration of Industry on the Wynants Kill, 1816-1911
The small Wynants Kill is known in the history of water power for Merritt et al. vs. Brinkerhoff et al. (1820) and for the Burden Water Wheel, largest in the world (1851)events that bracket the first, intense, period of industrialization on the stream (a "portrait" of the climax is derived from data in the 1855 census of New York state). The mill sites were connected not only by geography and their feudal tenure, but also, vertically, by a cooperative association formed by the lessees of the water privileges (1829), by industrial arrangements, and by community development. We will use postal activity indices, generated from the Official Registers (a business data source not widely appreciated), for the measure and timing of this commercialization of the Wynants Kill watershed.
Panacea or Dud? Retailers React to Scrip in the Great Depression
This paper will explore the phenomenon of scrip, or alternative currency, which flourished after the stock market crash of 1929. Cities and towns across the United States attempted to encourage consumption and alleviate unemployment by issuing their own forms of money. Scrip advocates argued that such plans would allow people to keep their dollars working within their own communities, concentrating efforts at recovery. But not all residents viewed the schemes with the same level of enthusiasm: this paper will explore the varied business reactions to scrip proposals. I argue that the study of scrip demonstrates that despite the networks of communication and distribution that linked the nation in the 1930s, many people thought of their participation in the economy in local terms. This belief created conflicts for retailers, who hoped to encourage the patronage of local clients but needed "real" money to pay suppliers outside of the community. Scrip schemes relied on merchant participation to be successful, and in many cases retailers readily endorsed the plans as necessary to improve business conditions. In other instances, however, those proposals floundered as businesses refused to accept scrip coupons.
Reinvention, Renewal, or Repetition? The Great Western Railway & Occupational Safety on Britain's Railways, c.1900-1920
This paper examines the dramatic changes in occupational safety education on Britain's railways between approximately 1900 and 1920. Facing increasing union pressure and the threat of immanent state intervention, the Great Western Railway (GWR) introduced a new safety campaign in August 1913: the "Safety First" movement. This paper will assess the extent to which this "new" campaign reinvented occupational safety education in Britain. I argue that new techniques of communicating safety messages were combined with the relatively traditional content of these messages: rather than a simple repetition of previous attempts, or an absolute reinvention of safety, the campaign was a renewal of existing conceptions of occupational safety education. This paper examines both the methods of conveying safety messages and the messages themselves. I argue that occupational safety was partly determined by the power relationships between union, state and company. This social construction of "safety" and the elision of reinvention and repetition were therefore fundamental to the GWR’s renewal of safety education.
Busines Barometers: Roger Babson and the Rise of Economic Forecasting
Forecasting is an ancient art that has always been part of commerce. Beginning in the late nineteenth century, forecasting methods became more scientific. Roger Babson was one of the pioneers of this transition. He collected a range of data, including bank clearings, immigration numbers, commodity prices, railroad earnings, and other information and combined them to form the Babsonchart, which offered predictions of future booms and busts. By the 1920s, Babson was mailing out his forecasts to businessmen and investors around the globe. Not as sophisticated as his competitors at Harvard and Yale, he nonetheless popularized the industry and, also unlike them, correctly predicted the 1929 crash. The story of his forecasts reveals how longstanding commercial ambitions, like the desire to predict the future, became incorporated into managerial capitalism, with its quest for rational efficiency, at the start of the twentieth century.
Sectional Loyalties and Institutional Transformation in Missouri’s Banks, 18611870
Money and banking in the United States changed profoundly during the Civil War, giving the country the first federal currency since the Revolution as well as the modern system of national banks. A look at the banks of one state, Missouri, in this tumultuous period shows that change at the firm level was even more drastic: though Missouri’s banks, along with the railroads, were the only major antebellum firms to survive the War and become part of the emerging postwar big-business complex, this transformation was accompanied by a virtually complete turnover in the banks’ officers, major shareholders, and customers. These changes were exacerbated by a massive financial fraud undertaken by the state’s bankers at the outset of the conflict, in an episode previously overlooked in Civil War history: in 1861 Missouri’s bankers diverted large sums of money from their institutions to support the rebellion, a scheme that collapsed and took down not only the bankers but many of the wealthiest families in the state. This incident had a significant impact on the state’s postwar economy and politics, and is a case study in the effects of groupthink on the decision making of a closed, tightly knit managerial group in a time of crisis.
Eric Godelier and Muriel Le Roux
Did the 1970s Lead to Convergence or Divergence? Usinor vs. Pechiney: A Cross-Examination of Renewal in the Steel and Aluminium Industries [paper]
If today Arcelor appears to be a successful company, leading the world steel market, Pechiney followed a more difficult path, concluding with its recent merger with the Canadian Alcan. The two French companies apparently faced similar problems during the 1970s: a brutal decrease in demand, the need to renew production capacities, the end of the previous paternalistic human resource policy, a turn to more innovative production processes. Despite differences in the market rules and structures between the two industries, or in the economic and social importance of each in France, a quick glance would confirm the proximity of steel and aluminium industrial and management models. Are we witnessing an evolution toward total industrial similarity? In fact, the situation is more subtle. What explains Usinor’s success in being a major force in Arcelor, whereas Pechiney became a small part of giant Alcan? At the end of the 1960s, while Usinor engaged in a large mass-consumption market with low or average quality products, Pechiney produced high-quality goods for a relatively small number of aluminium users. Aluminium was gaining new customers and appeared to be THE modern material, whereas steel was seen as a common product. But in the following decades, Pechiney left aside its focus on its core competency in aluminium, while Usinor remained focused on the continuous mill technology and flat product market that had been the choice of the company’s creators.
Hugh S. Gorman
The Transformation of Emissions and Effluents into Factors of Production
Over the course of the twentieth century, many changes related to the control of industrial pollution have occurred, including changes in industrial processes and practices, the scale of industry, public expectations, technological and scientific knowledge, and regulatory techniques. However, the major change has been the transformation of emissions and effluents into factors of production that firms are expected to measure, monitor, and manage, a transformation that occurred gradually over the course of a half century. This paper illustrates this transformation from "the bottom up" by examining the interactions between pollution control officials and the operators of one industrial facilitya refinery in Lemont, Illinois, in the period 1925-1985. The facility was constructed when nuisance law and economic incentives to reduce waste were the main mechanisms limiting releases; by the 1980s, state-level permits specified performance levels, and facilities were expected to manage their emissions appropriately. Examining this transformation from the bottom up provides one with a more complex picture than is possible from examining regulatory changes alone.
Reinventing Health Care: Corporate Health Care before the Welfare Movement, Lowell 1839-1890
Most American historians point to the welfare movement of the late nineteenth century as the start of employer interest in workers’ well-being. Yet, on May 11, 1840, the Lowell Corporation, cotton manufacturers in Lowell, Massachusetts, opened the first industrial hospital in America. The Corporation provided the operating funds and medical care, but patients were expected to pay for their keep. The cotton manufacturers provided a surety so employees were not denied care. This paper addresses the reasons why the Lowell Corporation established and continued support for a hospital at a time when manufacturing interest in workers centered on profit. It argues that Lowell manufacturers were the first group of American employers to believe that a healthy workforce was valuable for business success, although the hospital was not profitable. It also provides insight into the varying working conditions and employees' health between companies. Individuals remained in control of their health because workers were not forced to enter the hospital when ill. Workers continued to rely on self-help, home remedies, and local medical care. Thus, although the Boston Associates had transformed business practice, their efforts were not complete without employee compliance.
An Industry of Enthusiasts: Users Make the Computer Personal, 1975-1981
Crucial aspects of technological innovation and industrial creation take place through the apparently passive act of technological adoption. This paper examines the various ways in which computer enthusiasts contributed to the development of the personal computer industry, from its conception in 1975 to its early adolescence with the introduction of the IBM PC. This is particularly apparent here, since early personal computers were almost entirely useless. The only application supplied as standard on most models was BASIC programming. Because their suppliers lacked elaborate market research abilities, or good ideas on what ordinary people might do with a computer, users did most of the cultural and technical labor required to transform the personal computer into a reasonably useful and practical tool. The incredible flexibility of computer systems, achieved by adding additional hardware and by reprogramming, makes this an exceptionally good case in which to study user involvement. As is well known, electronics hobbyists were both the first users and the first suppliers of personal computers. But enthusiasts also founded the first personal computer dealerships, user groups, software companies, trade shows, newsletters, and magazines. I use the career of Dan Fylstra, publisher of VisiCalc (the first spreadsheet program and by far the most successful early microcomputer application package) to illustrate the interplay of these institutions.
Per H. Hansen
Organizational Culture, Narratives, and Organizational Change: The Transformation of Savings Banks in Denmark, 1965-1990 [paper]
In this paper I discuss the organizational change of Danish savings banks from self-governing, non-profit organizations into joint-stock corporations and commercial banks. This change took place from around 1965 and was completed in 1990. I focus on three key events in this transformation and I analyze them in order to show how the narrative of the savings banks were instrumental in understanding their organizational culture and identity. Furthermore, I argue that these narratives lay behind the savings banks’ culture and that they were important obstacles to organizational and institutional change, because they created path dependence. Finally, I use this perspective to argue that Douglass North's concept of informal institutions needs much more elaboration and stringency and that narratives should be considered informal institutions.
The Fordist Factory as a Fourierian Phalanstery? French Reinventions of the American Model between the Two World Wars
As the Scientific Management movement tried to make inroads into Europe after the Great War, a French machinist named Hyacinthe Dubreuil (1883-1971) became determined to confront the American model of industrial modernity head-on. Dubreuil had been a vocal critic of "the Taylor System" before the war, but after spending nearly a year and a half traveling across America’s industrial belt and working in some of the nation’s most rationalized plants, from Taylorized firms like Dennison and the White Motor Co. to Ford’s enormous experiment at River Rouge, he became one of France’s most outspoken defenders of American forms of industrial rationalization and labor-management relations. What set his account apart from other French advocates of industrial rationalization was the trade unionist’s curious comparison of Ford’s assembly line with the socialistic "phalanstère" of the nineteenth-century French utopian Charles Fourier. In comparing the strange genius of Fourier with Ford’s innovative vision, Dubreuil was trying to translate Fordism into the French imagination. Making mass production resonate in an economy still dominated by small and medium enterprise was, however, an uphill task. Analyzing his efforts thus provides a perspective on the obstacles to the "Americanization" of French and European industry before the Second World War.
Donald C. Jackson
The Business of an Engineering Consultant: John R. Freeman and the Hetch Hetchy Project
This paper examines the consulting business of John R. Freeman (1855-1932), president of the American Society of Civil Engineers in 1922 and a hydraulic engineer of international renown. An 1876 graduate of MIT, Freeman became a prominent consultant in the design of private hydroelectric power plants and municipal water supply systems. Starting in 1910 he helped San Francisco design a municipally owned water supply and hydroelectric power system; Freeman’s plan featured a 200-mile long aqueduct and power plants with 200,000 HP generating capacity. Always maintaining an aura of professional objectivity, Freeman used his status as an engineer to manipulate the space between publicly controlled municipal organizations and myriad privately controlled companies and groups. In so doing, he served as a primary lobbyist in winning federal approval for building Hetch Hetchy Dam within the boundaries of Yosemite National Park. The paper’s focus is not on the Hetch Hetchy project per se, but rather on how Freeman conducted his lucrative consulting engineer business within the roiling political economy of the Progressive Era.
Richard R. John
Telephomania: The Contested Origins of the Urban Telephone Operating Company in the United States, 1879-1894
Recent scholarship on the early history of telephony in the United States focuses primarily on the expansion of telephony into rural districts in the period after the expiration of Alexander Graham Bell's fundamental telephone patents in 1894. My paper redirects our understanding of early American telephony by focusing on the rise in the 1880s of the large urban operating company. At the center of my story is Charles N. Fay, the acerbic general manager of the Chicago Telephone Company. Fay's contempt for telephone users was legendary: at one point, he publicly declared that they suffered from a "telephomania" that predisposed them to be hostile toward his company. My paper reconstructs Fay's struggles with his customers, his competitors, and the Chicago City Council. In so doing, it demonstrates how the forgotten history of these early struggles shaped the subsequent rise of the telephone network in the United States.
Linda L. Johnson
The House of Homma: Organizational Reinvention in Early Modern Japan
The House of Homma was one of the few business organizations that successfully made the transition from the highly regulated markiets of early modern (Tokugawa, 1600-1868) Japan to the freer markets associated with imperial restoration in the modern period (Meiji Restoration, 1868). From the seventeenth century to the twentieth century, before World War II, the Homma successfully negotiated the changes in government regulation, reinventing their organization from retail merchants, to rice brokers, to moneylenders, and finally landlords having the largest holdings in prewar Japan. During the early modern period, their financial expertise provided local political authorities and peasant cultivators with the financial protection to withstand the vicissitudes of crop losses and exigencies associated with with feudal government. Leaders in the commercialization of the Shonai Plain (present-day Yamagata Prefecture) into one of the most reliably high-producing rice regions in Japan. Perhaps the most striking characteristic of the Homma is their reputation as traditionalists; during the upheavals associated with rice cultivation and marketing, the Homma maintained the practices associated with tenant relations that they developed in the early eighteenth century.
Ronnie Johnston and Arthur McIvor
Reinvention or Renewal? The Coal Dust Problem in British Coal Mining before and after Nationalisation [paper]
This paper is based on recent archival research combined with oral history interviewing of 25 miners with experience of coal dust exposure. Such testimony, we believe, illuminates the gulf between corporate policy on health and safety and the implementation of this policy at the workplace. Nationalisation of the coal industry in 1947 presented an opportunity to fundamentally improve health and safety in the mines and to address the issue of coal dust disease. However, although the NCB directed resources into protecting miners from the harmful effects of respiratory dust, many of its policies on the prevention of dust disease, together with the attitudes that underpinned them, predated nationalisation. What emerged in 1946and was to persist until the mid-1970swas a reinvention of private capital and state approaches developed in response to a compensation crisis in the prewar period. The NCB adopted and adapted this template to address its own coal dust crisis in 1946, andlike the private ownerslocated coal dust prevention as an engineering problem to be solved by the application of technology. However, as coal cutting technology developed from the 1950s, dust suppression technology struggled to keep up to the detriment of miners’ health.
K. Austin Kerr
The Rebirth of Brewing and Distilling in the United States in 1933: Government Policy and Industry Structure
Brewing and distilling were large industries, banished under American prohibition laws, that were reborn with the repeal of prohibition in 1933. Government policy, however, shaped the structure of those industries. After rejecting government ownership of the distilling industry, Roosevelt’s New Deal used the National Industrial Recovery Act of 1933 to impose for alcoholic beverages a three-tiered distribution system of manufacturing, wholesaling, and retailing, a system that has persisted to this day. The three-tiered system was thought to answer the need to have some control over the marketing of alcoholic beverages (all modern societies exercise such controls) without being overly intrusive. This paper explains the considerations behind the establishment of a three-tiered distribution system for alcoholic beverages.
The Next Best Thing to Getting Married: Partnerships among the Jewelry Manufacturers in the Providence/Attleboro Area during the Nineteenth Century [paper]
This study aims at enhancing our understanding of how industrial conditions affect the choice of firm ownership structure. The Providence/Attleboro area was a center of jewelry production during the nineteenth century. Due to the differentiated nature of their product, the Providence/Attleboro jewelers needed to actively promote their products to the wholesalers in distant markets. This geographical and industrial condition motivated the entrepreneurs to organize partnerships for ameliorating informational asymmetries and for mobilizing resources required to achieve economies of scale in sales and production.
Marine Insurance in Britain and America, 1720-1844: A Comparative Institutional Analysis
By the mid-nineteenth century, the British marine insurance market was dominated by Lloyd's of London, a marketplace in which voyages were underwritten by private individuals. In contrast, marine insurance in other countries, including the United States, was carried out mainly by joint-stock corporations. This paper examines the historical evolution of the marine insurance industry in Britain and America during its critical formative period, focusing on the information and agency problems inherent in the technology of overseas trade at the time, and on the path-dependent manner in which the institutions that addressed these problems evolved. We argue that the market was characterized by multiple equilibria because of a potential lemons problem. The regulatory environment produced by Britain's Bubble Act, and exogenous shocks including American Independence and the Napoleonic Wars, combined to bring about a bifurcation of institutional structure, the effects of which persist to the present day.
Public Relations as Redevelopment Tool: Accentuating the Positive in Deindustrializing New England
Attempts to revitalize local economies hit by industrial downsizing have been explored by a number of historians. Scholars have paid little attention to the public relations aspect of these efforts. This paper argues that publicity campaigns can be a central component of redevelopment drives. The subject is explored through an examination of New England, which experienced widespread factory shutdowns in the early and mid-twentieth century. Pervasive negative impressions of the deindustrializing area economy set the stage for New England’s public relations campaign. Plant closures demoralized regional residents. Their pessimism was amplified and widely disseminated by press coverage that highlighted the dire circumstances in the area and posited deep-seated economic flaws that would hinder recovery. The leaders spearheading the push for New England recovery feared that these negative images might further worsen conditions. In response, they mounted a vigorous publicity campaign highlighting the region’s economic strengths. This effort made use of the techniques of modern advertising and public relations and featured the distortions that typify those fields. The drive to promote positive images of New England seems to have improved perceptions of the area economy and may have encouraged investment there.
"Enriching Women’s Lives": The Mary Kay Approach to Beauty, Business, and Feminism
In 1963, Mary Kay Ash founded Mary Kay Cosmetics with the stated purpose of "enriching women’s lives." Mary Kay sales consultants,99% of whom are female, work as independent beauty dealers by selling cosmetics and skin care at small parties. Sales supervisors make use of "feminist" language to encourage and enlist consultants. However, the company combines an emphasis on female self-empowerment with politically conservative rhetoric. Mary Kay also employs motivational psychology, "family values," and Christianity to attract and direct consultants. I have interviewed Mary Kay consultants and examined promotional literature and product campaigns to chart the company’s ideological development. This paper will explore Mary Kay’s surprisingly coherent ideology of feminism and conservatism, a blend that has made this company accessible to its consultants and customers for over four decades.
Management Education Oversight Bodies in 1960s Britain
This paper examines the creation of multiple committees intended to make policy decisions and offer guidance on the development of management education in 1960s Britain. The paper looks at the four most visible of these groups with an aim to unravel the forces behind their establishment, their individual goals, and, more significantly, their often confused relationships with each other. The groups that formed later consciously recruited members of existing committees in order to facilitate cross-communication. Was this an effective policy? Using both primary and secondary sources, this project responds to contemporary (slightly tongue-in-cheek) criticisms that asked whether yet another committee might be needed to coordinate the various management education committees that had arisen. By looking at their goals and actual accomplishments, the paper asks whether they were all necessary or whether it was simply fashionable to create and serve on a management education committee.
Thomas C. Lassman
Research Networks in the Steel City: The Growth and Diversification of Industrial Research in Pittsburgh, 1930-1941
Throughout most of the twentieth century, Pittsburgh was America’s dominant steelmaker, and much of the city’s history has been written within that context. Largely unknown to historians, however, is the extent to which Pittsburgh’s industrial success depended on a regional network of industrial laboratories and universities. During the 1930s, Westinghouse Electric and the University of Pittsburgh became major centers for advanced research in modern theoretical physics. The cooperative efforts undertaken by the two institutions to broaden the scope of physics research in Pittsburgh anticipated a similar and more widespread shift toward basic science in industry after World War II. However, a costly disjunction between the accumulation of new knowledge and the corresponding development of commercial technologies often appeared in firms that increased their expenditures for academic-style research. Exploring the extent to which this type of research permeated Pittsburgh’s research network and improved corporate performance before World War II may provide some clues to help explain the region’s industrial decline in the 1980s and also offer some insights into the economic renewal that was driven by the growth of small, high-technology companies in the 1990s.
The New Economy Business Model and the End of the "Organization Man" [paper]
This paper documents and analyzes the evolution of the "New Economy business model" (NEBM) over the past half century. Through the high-tech boom, bust, and recovery of the past decade, the NEBM has emerged as dominant in the U.S. information and communication technology industries, and elements of the NEBM have spread abroad. Strategy, finance, and organization are distinctive in the NEBM compared with the Old Economy business model (OEBM) that had evolved during the first half of the twentieth century. Strategically, the NEBM is highly focused on specific products and processes in contrast to horizontal diversification and vertical integration under the OEBM. Financially, under the NEBM, firms tend to pay no dividends, using all their retained earnings to fund growth. When they have grown large, however, NEBM firms engage in repeated large-scale stock repurchases so that they can better use their stock as a currency to acquire technology companies and, in the form of stock options, to compensate a broad base of employees. Organizationally, these employees tend to be highly educated, and routine production activities are automated and outsourced. The NEBM stresses the interfirm mobility of labor and the globalization of employment, with increasingly higher value-added activities being performed outside the United States. In historical perspective, the NEBM is the end of the "organization man."
Arthur J. Levine
"Mercenary, Mendacious Mythology"? Assessing the Insurance Industry's Explanation for the Product Liability "Crisis" of the 1970s
During the 1970s American insurers declared a "crisis" in product liability. They argued that strict tort liability and the rise of "consumerism" had produced a litigation "explosion." Many claims, they said, were unwarranted and resulted in excessive monetary awards. Insurers dramatically increased product liability premiums and called for substantial reform of the nation’s tort system. I will discuss insurers’ assertions and analyze why they made themespecially the critical lack of data that fueled their fears. I will note the deteriorating financial returns that insurers experienced during the period, as well as the factors beyond product claims that contributed to such returns, including highly subjective pricing of product liability insurance and broadly worded "occurrence" coverage. I will discuss federal government and insurance industry investigations of the purported crisis and the results of these examinations. Then I will turn to the end of the "crisis" and its relationship to high interest rates and the property-casualty "underwriting cycle." I will conclude with an assessment of some contemporary critics’ claim that the insurance industry perpetrated an actual fraud upon the public, legislators, and regulators, and suggest the episode’s relevance to recurring calls for tort reform.
Container Shipping and the Decline of New York
The development of container shipping in the late 1950s and the 1960s represents a major technological advance with significant economic consequences. By dramatically lowering the cost of freight handling, the container reduced the need for factories to be near suppliers and markets and opened the way for manufacturing to move out of urban centers, first domestically and then abroad. This impact was particularly intense in New York City, where the container revolution began. New York officials fought doggedly but ultimately unsuccessfully to keep the maritime industry in the city. The departure of ship lines for more suitable piers in New Jersey had a devastating impact on New York City’s economy, and was a major contributor to the collapse of its industrial base between 1967 and 1975.
Long Lines: AT&T, Long Distance Telephony, and Corporate Control [paper]
In January 1915, the American Telephone and Telegraph Company connected the United States’ first transcontinental phone call. The New York - San Francisco circuit was an impressive technological achievement, but the lines were extremely expensive, and demand for very long distance service was minimal. The fanfare surrounding the transcontinental call and the emphasis AT&T placed on long lines in general seem out of proportion to the commercial importance of long distance telephony at this time. This paper argues that the great importance of long distance to AT&T was not commercial, but political and cultural. Long distance played a key role in justifying the centralization of corporate control in the telephone industry and the nation at large. The Bell System before the 1910s was not a single firm, but an association of regional operating companies with considerable autonomy. As AT&T’s leaders fought to curtail this autonomy, long distance service offered a powerful technological justification. Outside the Bell System, the transcontinental network also served as a symbol of interconnection and integration. It became central to AT&T’s campaign to convince Americans of its own legitimacy and that of nation-spanning corporations in general.
The People's Telephone: The Politics of Telephony in the United States and Canada, 1876-1926
"The People's Telephone" is a comparative history of the telephone in the Midwestern United States and Central Canada, from its invention in 1876 to the completion of a nearly ubiquitous continental network by the 1920s. At each step of the telephone's construction, business, politics, and technology were intertwined. Struggles between small firms and large corporations, between regional and national networks of commerce and information, and between autonomous entrepreneurs and salaried managers were all projected onto seemingly prosaic disputes about the telephone and its wires. The competing networks built in this era embodied prescriptive arguments about the ideal organization of the economy and society, and in particular the organization of business firms. A nationalist mission for the telephone helped preserve the Bell monopoly in Central Canada, while localism and hostility to national integration fuelled early opposition to Bell in the Midwestern United States. But outcomes were ironic. Despite Ottawa's desire to enlist the telephone as an agent of national unity, a quilt of distinct provincial systems emerged in Canada, while the telephone fight in the United States produced integration and consolidation.
Reinventing a "Uniquely American" Institution: Supermarkets in Europe, 1945-1970
Following World War II, American business and governmental leaders cooperated to transform food retailing in Western Europe by helping to introduce retailing practices seen as uniquely "American," self-service and large supermarkets. European business leaders, however, deliberately tailored their supermarkets to appeal to local tastes and improved upon American models. By the end of the 1960s, their success led to the emergence of European reference points for self-service operations, inspiring American business leaders to look across the Atlantic for new ideas about supermarkets. Such developments complicate notions of the "Americanization" of European business and society by drawing attention to the cross-fertilization involved in the spread of "American" practices and products around the globe.
Railroads and State Building in the Old South
Using Virginia and South Carolina as test cases, this paper investigates an important regional difference in the antebellum United States. Whereas railroads represented the beginning of the end for state enterprise in the North, southern railroads heavily depended on public investment. State and local governments provided more than 50 percent of the capital for southern railroads, whereas public investment in the North and West amounted to only 15-20 percent of total railroad capital. I argue that the South's reliance on public investment was the result of slavery and land-hungry agricultural practices, which lowered population densities and undermined the profitability of southern railroads. Unable to attract private investment, southern railroads turned to state and local governments as a means to survive. Ideologically, railroad supporters justified public investment as a means of defending slavery. Public investment in southern railroads helps explain the growth of the Confederate State during the Civil War. For Virginians and South Carolinians, public support of large-scale enterprise was hardly a revolutionary experience born of wartime exigency. It was, in fact, the norm of the antebellum period.
Aaron W. Marrs
Operating Early Amerian Railroads: A Comparative Approach
Although the historical literature on railroads of the southern United States is small, southern railroads have generally not fared well when being compared to their northern neighbors. I will be arguing for a reconsideration of southern railroads and employing a comparative framework for much of my discussion. By using this framework, I hope to accomplish two tasks. First, this technique demonstrates that problems faced by the southern railroads were not due to some unique "southernness" or a planter-inspired opposition to modernity, but were rather railroad problems faced by companies nationwide. Second, a comparative approach integrates southern railroads into the historiographical mainstream by demonstrating that they had some of the characteristics lauded by Alfred Chandler in his landmark The Visible Hand. In short, situating southern railroads in a wider national and international context makes their perceived shortcomings appear less problematic.
Paul J. Miranti
From Product Inspection to Statistical Quality Control: The Reinvention of Manufacturing Quality Assurance Capabilities at the Bell System, 1877-1929
This study evaluates how the Bell System integrated learning and organizational capabilities to support the development of its quality assurance function from 1877 to 1929. Quality assurance was vital because it certified the reliability of equipment and apparatus that the telephone network relied on to provide efficient and economical service. The transformation of this function progressed through two major stages that responded to changing strategic priorities and organizational structures. The first involved strong horizontal growth of the telephone system and the backward integration to acquire manufacturing capabilities. During this era, which also witnessed the beginning of the rise of professional management at the firm, learning involved the establishment of plant product inspection practices and the differentiation of quality assurance roles and responsibilities among AT&T, Western Electric and the regional operating affiliates. The second stage which began about 1913 compelled the telephone company to develop new strategies when its ability to continue to expand horizontally became severely curtailed by regulation and technological considerations. New inward-looking planning sought to bolster consumer demand and reduce costs through system automation and improvements both in the quality of transmission services and the reliability of network apparatus. Learning in this stage involved the development of a much more comprehensive organizational structure for coordinating quality assurance both at the staff and line levels and betweenthe three corporate elements that made up the Bell System and the newly founded Bell Telephone Laboratories. It also, however, fostered the development of innovative methods of quality analysis that incorporated knowledge of probability theory. This new regime, known as "statistical quality control," SQC, proved highly effective in broadening manufacturing knowledge, establishing quantitative definitions of quality, reducing costs and risk, and establishing clear parameters of product reliability. Eventually the upgrading of learning led to the formation of a new profession of quality engineering, which found adherents across many industries in the United States and abroad.
Eric J. Morser
Grassroots Rebels: Municipal Power and Railroad Regulation in La Crosse, Wisconsin, 1883-1900 [paper]
Historians typically depict Gilded Age railroad regulation as a story of corporate executives manipulating politicians and political institutions to increase their profits and create economic stability in their industry at the expense of common people. This paper argues that this conventional view is flawed because it focuses too much attention on the failure of federal and state legislatures, courts, and commissions to regulate railroads and does not consider whether Americans may have used municipal power to rein in railroads during the nineteenth century. Taking La Crosse as a case study, the paper demonstrates that small cities had the potential to enact robust programs of railroad regulation between 1883 and 1900. During this period, La Crosse’s common council passed ordinances that gave railroads the privilege to enter and expand their operations in the city, but that also regulated them so that they would act in the community’s broader interest. Furthermore, the council continued to enforce these laws after 1883. As a result, railroad regulation was a fact of life in the city at the end of the nineteenth century. Ultimately, this hidden history of successful railroad regulation in La Crosse between 1883 and 1900 suggests that municipal governments may have played a far more significant role in defining the contours of late nineteenth-century American economic development than scholars have previously believed.
Sharon Ann Murphy
Protecting Middle-Class Families: Life Insurance in Antebellum America
This paper examines how antebellum Americans addressed the most fundamental risk they would encounterthe risk of death. Generations of families had survived the economic consequences of the death of the family head by relying on extended kinship networks, community resources, land ownership, and even remarriage. But the combination of rapid urbanization, economic volatility, and the increase in salaried employment undermined many of these traditional safety nets. In particular, during the panic of 1837 and the depression of 1839-43, members of the emerging middle-class (people with economic and social aspirations but who were dependent on the existence of a regular income to maintain or improve upon their status) increasingly sought the protection that life insurance provided their families. By examining the characteristics of the people actually purchasing policies between 1830 and 1850, this paper will create a composite profile of who was insuring and how this profile changed over time. By the second half of the nineteenth century middle-income Americans would form the core of the life insurance market, and life insurance would become a defining characteristic of what it meant to be a member of the middle class.
Women Investors in Early Nineteenth-Century English Joint-Stock Banks
In 1826 the Banking Act allowed the establishment of joint-stock banks (JSBs) in England and Wales. Institutions taking advantage of this legislation could sell shares to an unrestricted number of partners outside a 65-mile radius of London, although shareholders remained exposed to unlimited liability. The new JSBs did not reinvent banking. Many operated in a very similar way to their private predecessors and many were formed from private banks. But they did have a positive effect that may be described as a renewal or rejuvenation. This process involved the input of shareholders. Investors bought capital and, it may be argued, stability and success into joint stock banking. By the end of the nineteenth century JSBs had proved to be far more successful institutions than their private counterparts. This paper aims to examine a particular group of investors in the new JSBswomen. It analyzes twenty joint stock banks that were formed under the 1826 Act. No one has fully considered the particular input of women investors into the new wave of quasi-corporate banking institutions. This paper provides a fresh area of research.
Birth of the Credit Man, 1890-1920: A Stage in the Struggle over Transparency in American Business
The formation of the National Association of Credit Men (NACM) in 1896 signaled the professionalization of credit granting among U.S. merchants and manufacturers. This paper explores the association's twin objectives: pushing for greater financial transparency in all American businesses (not just the trusts); and encouraging the sharing of debtors' payment records among credit men working for competing firms. The NACM helped to legitimize the highly controversial methods that credit reporting firms pioneered beginning in the 1830s. In addition, the NACM facilitated the spread of credit interchanges (bureaus), an information-sharing arrangement that had taken root in Britain and Germany, but was slower to develop in the U.S. (The paper is based on the last chapter of a book manuscript. That larger work traces the evolution of the idea of transparency in American mercantile credit during the period 1830-1920.)
Reinvention and Renewal in American Bookselling: Some Dynamics of Distribution Institutions
In 1900, the manufacturing sector of the American economy employed more than twice as many people as the distribution sector. By the year 2000, distribution employed half again as many and accounted for the larger share of GDP. The sector is of great importance to economic welfare in subtler ways as well. Tastes are heterogeneous across the population and variety on offer matters to most consumers along with low prices. Although it is easy to imagine that the efficiencies of the present were always with us, the present distribution system is a relatively recent development; and the emergence of its present standard of performance is a matter of changing institutions as much as it is of incremental increases in the efficiency of already existing institutions. All this is worthy of much more attention from business historians than it has received to date. The book trade is an excellent grain of sand in which to observe this world. Most retail venues have physical constraints both on how many volumes they can keep in stock and on how many they can display. There are arguably well in excess of a million distinct stock-keeping units among which the retailers must choose (with something like fifty thousand new possibilities appearing each year from a wide variety of sources). These include both steady sellers and fashion-sensitive goods. Books are published in sizeable batches, so there is also a question of who will hold inventory. A wholesale segment of the trade participates in this and otherwise assists in the overall flow of goods. The institutions organizing this flow and facilitating the variety outcomes potential customers observe have evolved over the course of the twentieth century and have changed quite radically since c. 1970. The paper studies the emergence of the (chained) superstore format, analyzing the early histories of the principal firms in terms of the capabilities they developed and the competitive dynamicsamong the chains and between the chains and independent bookstoresthat these engendered. The complex impact on this course of events of the onset of online retailing and of a not well appreciated series but profoundly influential series of changes in the organization and capabilities of the wholesale sector are explored. Both reinvention and renewal are illustrated and, in this setting at least, unpacked.
"Give the single girls a chance!": Employees' Views on Preference for Service and Layoffs at Western Electric in the Depression
The Western Electric studies found that employees’ opinions about work were related to experiences outside work. Home situations and social relationships had a powerful effect on workplace disaffection and productivity. This paper explores another part of the relationship between employees’ social situation and their attitudes to work: views on married women working during the Depression. Before the Depression, interviews turned up little evidence that men or women cared much about married women at work. During 1930 and 1931, interviews reveal mounting concern about the company’s policy of retaining long-serving married women. Single women especially expressed hostility to the continued employment of married women. Facing financial pressures of their own, and feeling their own married life was delayed by the Depression, many single women argued the Company should lay off all married women. This contradicted the company’s long-standing policy of furloughing the most junior workers first. The company could not reconcile two conflicting notions of fairness: the first that long-service employees be retained during layoffs, and the second that the company account for inequity in household incomes when some families had two adult incomes while others had none.
Covering Up the Coppertone Girl: The Medical Transformation of the Sun Care Product Industry in Twentieth-Century America
In 1994, after forty years of gracing billboards across America wearing only shorts, playfully tugged down by a tag-along puppy, advertising icon "little miss Coppertone" donned a shirt, hat, and sunglasses for the first time. This new look reflected a deeper transformation within the sun care product industry. Sun care productsdefined as any preparation intended to alter the effects of the sun’s rays on the skinwere first known as "suntan lotions." In the 1950s and 1960s, these products targeted beach-going Americans in search of a golden tan. By the 1970s, driven by concerns about the depletion of the ozone layer and the resultant increase in Americans’ exposure to carcinogenic ultraviolet light, skin cancer prevention emerged as a national health issue. Astute sun care product companies recognized this opportunity, and began to develop a new product. By adding greater amounts of ultraviolet light-absorbing chemicals to suntan lotions, they created the skin-protecting sunscreen. In 1978 the FDA strengthened these claims of "protection," endorsing a product label which claimed that sunscreen could prevent skin cancer. Over the next two decades the skin-cancer preventing sunscreen came to dominate the sun care product market. Physicians, government regulatory authorities, advertising and marketing strategists, and consumers all participated in this transformation.
Industrial Pollution and the Role of Public Health Regulators and the Courts in the Development of the Meatpacking Industry, 1860-1880
This paper will provide a fresh perspective on the history of the meatpacking industry by placing innovation relating to the processing of animal waste by-products in the context of private litigation against the industry’s stench problems and the public health movement’s effort to enact regulations to protect urban populations from the filth-borne disease epidemics ravaging their cities prior to the bacteriological revolution of the 1880s and 1890s. Utilizing case law records, I will show that meatpackers initially adopted very primitive techniques for utilizing waste that resulted in the emission of air and water pollution whose foul smells caused great discomfort in the vicinity of their operations. Only under the pressure of regulation, angry communities of protest, and the courts did companies adopt the more sophisticated waste processing and pollution abatement technologies associated with the emergence of Armour, Swift, and the other large- scale vertically integrated meatpacking firms that came to dominate the industry at the end of the century.
Hockey Capital: The National Hockey League and Transnational Cultural Production, 1924-1967
My doctoral dissertation examines the business operations of the National Hockey League (NHL) from 1924 to 1967, the period in which it established hockey as a central component of Canadian and American sport and popular culture. The NHL was a transnational business with both American and Canadian teams, a Canadian labour force, and mixed Canadian/US capital and governance. Applying a business history methodology, I am exploring issues of geographic expansion, industrial monopoly, transnational ownership, and the production of culture by a commercial enterprise. Among other features, the hockey industry produced a relatively unique organizational forma national cartel that resisted centralization and formal vertical integration tendenciesthat describes an alternative path of industrialization. Indeed, the very notion of the sport as industry was repeatedly contested, which draws historians into a discussion of the part that business and industry play in the creation, production, and propagation of culture.
Rearmament and Recovery: The United States and the Economic Implications of Military Assistance to Western Europe under the Truman Administration, 1949-1952
The aim of this research is to frame the early years of US military assistance to the Western European countries within the context of economic, financial, and industrial issues touched upon by the military efforts carried out in the Western European NATO countries since about mid-1949 through the end of the Truman Administration in 1952. Its main argument is that during this period the establishment of the United States changed its approach to the economic dimension of rearmament. The first part, after a sketch of US military assistance abroad after World War II, is dedicated to trace the main features of the first military aid program. It was a bilateral assistance program based on two ideas: a widespread fear that military aid would impair the ongoing economic recovery promoted by the Marshall Plan; and a strengthening of military security in Europe through the transfer of end-items materials, raw materials, and consumer goods, aimed to pursue a mere reinforcement of existing military forces rather than to promote the creation of newand indeed job-creatingdefense industries. The second part is concerned with the structure of Mutual Security in 1950-51 as a multilateral rearmament program. I touch upon the main limits of military assistance and its procedures as they affected transatlantic relations. Then I stress how the reorganization of military aid to Europe as it turned out with the off-shore procurement programs since 1952 was strictly linked to a new concept elaborated by the Truman Administration about the nexus between rearmament and economic recovery in Western Europe whereby military strengthening could promote development and raise consumption in Europe.
Making Change: Money and Credit in Eighteenth-Century Commerce
This paper explores two aspects of the commercial world of eighteenth-century England by looking at the process and history of making change. Making change is always potentially awkward but it posed particular problems in the eighteenth century because of the relatively undeveloped nature of the financial system underpinning commerce and the shortage of cash. The first of these is apparent in the changing ways in which commercial people balanced their accounts during the course of the century, for it was only by the end of the period that merchants or manufacturers began regularly to remit payments in bills drawn on their banker for the exact amount of the invoice. Earlier in the century, recourse to bankers was much more rare, and thus payments were often rendered in bills of the approximate amount which left a balance that had to be settled by periodic payments of small amounts of cash. Tracing the history of the changing practices for making change through a comparative analysis of different regions and industries will help to illuminate the spread of more sophisticated financial networks as well as illustrating the ways in which the financial system structured the environment in which businesses operated. The second issue is apparent in the trouble that manufacturers took to obtain the cash necessary to pay their workers. Of particular interest are accounts that can be found in many extant ledgers with individuals who can best be described as "cash merchants" in that they supplied manufacturers with cash in return for bills of exchange. Manufacturers typically paid a premium for such services, but little is known about the individuals who supplied these relatively large quantities of coin or about the extent to which the pursuit of cash was linked to political preference and influence.
State Subsidies and the Sources of Company Finance in Italian Industrial Districts, 1951-1991
Works on Italian Industrial Districts (IDs) stress the private origin of their capital. This viewbased on many studies of Northeastern IDsimplicitly denies the potential significance of other sources of finance, such as state subsidies available to small and medium enterprises (SMEs) from the 1950s onward. This thesis brings Southern Italy into the broader picture of Italian IDs and tests whether IDs can emerge through state intervention as well as through private finance. The issue is analyzed from the institutional perspective as well as from that of the recipient firms. The former includes the comparison of financial subsidies to SMEs available through regional and national industrial policies and highlights the greater extent to which the South benefited from subsidized loans and grants. The recipient perspective uses two IDs, one from the South and one from the Northeast. The firms’ capital structure confirms the greater reliance of Southern companies on subsidies. However, contrary to the dominant view, companies in the Northeastern ID also made significant use of market and state finance. These findings are important for the international literature on IDs, which often overlooks the special attention paid to SMEs’ financial requirements in Italy since the 1950s.
Howard R. Stanger
Larkin Clubs of Ten: Cooperative Buying Clubs, Small-Town Consumption, and the Larkin Company
The Larkin Company began as a modest soap company in Buffalo, New York, in 1875. Until 1885, it sold soaps through the normal channels of the time. In 1885, taking advantage of Buffalo's rail networks and the success of mail-order in the hinterlands, Larkin embarked on a new selling strategy called "The Larkin Idea," whose motto, "From Factory-to-Family," reflected its direct sales approach that kept prices low. Innovations in the use of premiums also stimulated sales. By the late 1880s, the company retired its sales force and relied exclusively on mail-order. Around 1895 it institutionalized a network of cooperative buying clubs called the Clubs of Ten. A "secretary"mostly married women from small townsorganized nine other women to pool their limited financial resources to buy Larkin soaps in bulk. Each member received a premium, while the secretary earned additional gifts. These families could furnish their homes in middle-class fashion with the company's premium offerings. Club members were incorporated into Larkin's unique "family-based" corporate culture that also included employees, managers and executives. This progressive company also hired Frank Lloyd Wright to design a radically designed administration building in 1903. Larkin's success as a hybrid manufacturing/mail-order concern helped it weather the Panic of 1893. After reaching its peak in 1919, it experienced a slow decline owing to a number of internal and external factors. Entry into retail, in 1919, did not help. The Depression mortally wounded the company. Although the club structure continued into the 1940s, the company was a shell of its former self. The paper concludes with Larkin Company's important legacy to business historythe precursor to the post-World War II party plans made popular by Avon and Tupperware.
From Whence Hi-Fi? User-Led Industrial Formation in High-Fidelity Audio Equipment
In the late 1940s and early 1950s, a group of technological enthusiasts effectively fomented a new industry in home high-fidelity audio equipment. These passionate consumerscalled audiophilesbegan buying and assembling professional audio components from wholesalers to create customized, high-quality home audio systems. Presented with a committed, generally affluent, and growing group of consumers craving more realistic "high-fidelity" reproduction, a few entrepreneurs realized that a new home-audio market had practically fallen into their laps. By the mid-1950s, the hi-fi craze had swept across America, led largely by proselytizing audiophiles spreading the hi-fi gospel, and high-fidelity audio had become a thriving, profitable industry. This case of industrial genesis is notable for the extraordinarily strong role played by enthusiast consumers who actively "pulled" the home hi-fi equipment industry into existence through the sheer force of their spirited demand. Most hi-fi pioneers came directly from the ranks of audiophiles and kept their firms small. Strong ties between producers and consumers ensured the continued importance of audiophile enthusiasts in shaping the development of the industry. One legacy of this unusual industrial history was the persistence of pricing schemes in hi-fi audio that bore a closer resemblance to traditional wholesale pricing than to retail pricing.
Launching a Thousand Ships: Entrepreneurs, War Workers, and the State in American Shipbuilding, 1940-1945
My dissertation uses World War II shipbuilding to examine the origins of America’s postwar political economy. The collaboration between two companies, Kaiser and Bechtel, and government agencies demonstrates how the federal government cultivated private "supercontractors" who effectively mobilized the economy for war and extended state power at home and abroad. Working together, war agencies and firms like Kaiser and Bechtel revitalized American shipbuilding by developing new ship-assembly methods, including process techniques and wide employment of women and African Americans. To capitalize on patriotic fervor for production, the companies invited workers to join labor-management boards, sponsored ship-production competitions, and offered extensive social welfare benefits. The companies’ wartime success and prestige bore fruit after 1945, when both companies undertook more state-oriented endeavors and meshed their activities with the American government’s domestic and foreign interests. For instance, Bechtel helped shape America’s new state-sponsored nuclear power industry and built oil infrastructure all over the Middle East. In sum, Kaiser’s and Bechtel’s work during and after World War II constitutes an important ongoing episode in the history of collaboration between the U.S. state and private enterprise. This symbiotic arrangement has furthered American economic and political interests over the six decades since 1945.
Christiane Diehl Taylor
The World Turned Upside Down: The Public Face of Post-1960s Corporate Wives
Between 1890 and the late 1950s and early 1960s, harmony reigned between big business America’s expectations of corporate wives and popular culture’s depictions of these women. Large firms expected the ideal corporate wife to fulfill three business-related functions: the evaluative, the motivational, and the diplomatic. Popular media reinforced these company expectations by creating two antithetical depictions of the wivesthe helpmate and the torpedo. Yet with the revitalization of the women’s movement, the relationship between corporate expectations and media depictions turned dissonant. What corporations still saw as acceptable roles, the media increasingly portrayed as dysfunctional. As illustrated by Maryanne Vandervelde’s self-help book, The Changing Life of the Corporate Wife, Iain Macnab’s novel, The 42nd Year of Mrs. Charles Prescott, and the movie, The Stepford Wives, the helpmate became the dysfunctional wife and the torpedo, the self-actualized women. Thus within the popular culture of the late 1960s and early 1970s, corporate wives found themselves in a "world turned upside-down."
Gregory L. Thompson
Restructuring Transit for the Post-Industrial City: The Case of Portland, Oregon, 1958-1986
Political scientist James A. Dunn (1998) explains the dominance of the automobile in the US transportation system as a result of a powerful coalition of interests that in one way or another economically benefit from pro-automobile government policies, particularly road building. This coalition Dunn calls the automobile regime. Arrayed against the automobile regime is another regime composed of ideologically based interests believing that pro-automobile policies harm the collective public welfare. This coalition Dunn terms the vanguard. Since the 1960s, according to Dunn, American transportation policy has been forged in a war between these two regimes. This paper is a history of that battle in Portland, Oregon. It starts with the completion of Portland’s first freeway and abandonment of its last electric interurban railway, both of which occurred on the same weekend in January 1958, and it ends with the restructuring of its bus system and completion of its first light rail line in mid-1986. The paper focuses on how the pro-automobile environment of the late 1950s gave way to a huge reaction against freeways a decade later as the vanguard emerged victorious. It then examines how the automobile regime regrouped and joined forces with the vanguard in a deal that involved construction of the light rail line, a new interstate freeway that had been stalled, and the rebuilding and doubling in size of the freeway alongside the light rail line. While this deal making was going on, the vanguard also penetrated the bureaucracy of the transit system and restructured it, a move unseen by the deal making above it but ultimately responsible for much of the subsequent success of Portland’s transit system. The paper is based on newspaper accounts, planning documents from the period, and interviews with key participants from the period.
Tamara Plakins Thornton
Nathaniel Bowditch (F.R.S.) and the Science of Business in Antebellum Boston
The prominence of Nathaniel Bowditch in Boston’s elite financial circles raises questions about the links between business and science in the antebellum era. When he assumed the helm of the Massachusetts Hospital Life Insurance Company in 1823, Bowditch had significant credentials in commerce and insurance, but he was better known for his New American Practical Navigator and as a mathematician and astronomer elected to England’s Royal Society. It was this scientific background that most appealed to the Boston elite, for the habits of exactitude and regularity it entailed and the vision of a clockwork universe of business it inspired. Bowditch kept detailed account books, standardized office procedures, insisted on punctuality in loan payments, and treated the rules according to which business was conducted as inviolable laws. Such novel practices provoked unease among rural debtors and even some Boston capitalists. But Bowditch’s vision of business as an impersonal machine suggested even-handedness, an attractive notion to those whose business relations extended to men and women commanding substantially less economic power. More important, given the realities of antebellum businessrisk, booms and busts, gaps in informationthe Newtonian scientist as businessman offered reassurance that the world of business was predictable, ordered, and benign.
C. H. Tzeng
Understanding Economic Development in Modern China: The Interplay of the State, the Market, and the Social Sector
I propose to explore the interplay of the state, the market, and the social sector in the growth of indigenous firms in the economic development process. From the 1960s to the early 1990s, scholars were debating the roles of the state and the market in economic development. And by the late 1990s, the social sector entered the debate more seriously. But a tendency remains to argue that either the state (e.g., Amsden, 1989; Evans, 1995), or the market (e.g., Lal, 2000), or the social sector (e.g., Makoba, 2002) is the key to economic development, rather than all three working in concert. Furthermore, scholars tend to focus on the macroeconomic output (e.g., GNP) rather than on the microeconomic level (such as the growth of indigenous firms). In this research, I focus on the level of analysis of the firm and ask three research questions. First, what is the interplay of the three sectors in the economic development? Second, under what conditions do the three sectors work together to grow firms? Third, what is the division of labor among the three sectors? Following Lazonick (1990), I will analyze the comparative-historical experiences of three firms in each of socialist China and capitalist Taiwan: in China, Legend Computer, Great Wall Computer, and the Advanced Technology Service Department; in Taiwan, Acer Computer, United Microelectronics Company (UMC), and Vanguard International Semiconductor (VIS). These firms draw my attention because of their differences. First, Chinese firms and Taiwanese firms operate in contrary economic systems: socialist China and capitalist Taiwan. Second, these six firms were started up either by the state (Great Wall), a public research institute in the social sector (China’s Legend and Taiwan’s UMC and VIS), or techno-entrepreneurs in the market (China’s Advanced Technology Service Department and Taiwan’s Acer). Third, three of the firms are successful: China’s Legend, Taiwan’s Acer and UMC; the other three are unsuccessful. To study these six firms, I will use information from personal interviews with managers (or others) and from secondary sources, including trade and business magazines, business and general newspapers, academic magazines and journals, annual reports, and other publications of the organizations.
R. Daniel Wadhwani
Financial Institutions and the Management of Household Economic Risks in Nineteenth-Century America: Evidence from the Philadelphia Saving Fund Society
Using a sample of savings accounts from the Philadelphia Saving Fund Society that stretches from 1836 to 1900, this paper reconstructs the ways in which households came to use the services offered by one important type of financial institution to mitigate personal risks and pursue opportunities in the industrial economy. The paper focuses, in particular, on the experiences of three types of usersunskilled workers, working women, and migrant workersin order to understand how the use of savings banks (the first formal financial institution to serve Americans of modest means) became integrated into how households managed their economic resources. In broader perspective, the paper argues for the need to understand more fully the impact of financial developments on long-term changes in standards of living and access to economic opportunity over the nineteenth century.
The London East India Agency Houses, Industrialisation, and the Rise of Free Trade: Adaptation, Survival, and Demise, c. 1800-1850 [paper]
This paper will examine the rise and evolution of the London East India agency houses during the early nineteenth century. Their commercial activities and efforts to shape the policies of the British government in India and the East will be a central theme. In this they were forced to compete with provincial industrial interests in Britain, and this battle for supremacy will be charted. The paper will offer new critical insights into the debate about the "gentlemanly capitalism" thesis offered by Cain and Hopkins.
Robert E. Weems, Jr.
The 1961 National Conference on Black Business: The Negro Market, the Cold War, and the Future of Black Business in America
From November 30 to December 2, 1961,the U.S. Commerce Department sponsored a three-day conference with the theme "Problems and Opportunities Confronting Negroes in the Field of Business." This meeting focused upon the role of black business in a changing social, political, and economic environment (both nationally and internationally). This paper demonstrates that the anticipated dismantling of American apartheid, while perceived as a positive social development, had negative implications for black-owned businesses in the United States. In fact, this 1961 Commerce Department conference, besides featuring several pessimistic discussions related to the future of black businesses in a desegregated society, actively urged African American businesses to seek new clients among the newly independent nations on the African continent. Black businesspeople were told that such a strategy, besides sustaining their profitability, would enable them to play an important role in the international battle against communism.
Inscribing Design on the Nation: The British Council of Industrial Design and Its Early Public
In the waning moments of World War II, Britain's coalition government signalled its intention to create a Council of Industrial Design to "promote by all practicable means the improvement of design in the products of British industry." Conceived to counter the economic threat from competitor nations, the Council also embraced a social agenda, asserting that "lifting the quality of objects of common use in the hands and the homes of British people is a great objective in itself." Commentators have been critical of the naïveté of Council initiatives, but this paper will argue that the transformation of the standard of British manufactured goods, and the enhancement of the quality of life of British citizens, were valid objectives in the vacuum left by the cessation of hostilities. The Council's personnel included energetic individuals drawn from key roles in business, who had typically played a role in the expanded bureaucracy of the wartime state. Attuned to the public relations needs of the new organization, and convinced of the possibility of re-orienting the country's manufacturers, the Council offered consumers a recognizable role in the reproduction of national identity.