In Memoriam: Alfred Chandler and the Soul of Business History

I never really knew Al Chandler. While my teachers, Lou Galambos,David Hounshell, and Hugh Aitken, were to varying degrees closefriends with Chandler, I spoke at length with him only twice.I met Chandler for the first time in 1990 when I was tryingto decide where to do my doctorate and I met with him a secondtime when I held the Chandler Travel Fellowship at the HarvardBusiness School in 1995 as I was writing my doctoral dissertation.Chandler's scholarship consistently shaped my approach to thestudy of business history, yet my relationship was always toChandler's academic research rather than to him as a mentoror as a colleague. Although I never knew Chandler in a personal sense, I also neverknew business history without his overwhelming intellectualpresence. Since 1984, when I first studied economic historyunder Hugh Aitken as an undergraduate at Amherst     

Chandler: A Retrospect

I met Al Chandler in late 1962 (or early 1963), when he visitedthe Graduate School of Business, Columbia University, as a guestof Associate Dean Clarence Walton. Chandler gave a seminar,based on his new book Strategy and Structure. I was then atColumbia Business School, completing my (and Frank Ernest Hill’s)archive-based history of Ford Motor Company's internationaloperations, which was my first book. As my next project, I wasseeking to write an overall history of US business abroad. Iwanted to figure out whether patterns I had found in my researchon Ford abroad were typical (or atypical) of US corporations,in general, as the latter expanded worldwide. Recently, I looked at the preface (dated June 1963) of our AmericanBusiness Abroad: Ford on Six Continents, published in 1964;there was no acknowledgment of the     

Bringing Political Economy Back in

Like so many of the fields that have flourished in history departmentsin recent years, business history has an uneasy relationshipwith political history. When business history first emergedin the United States as a separate field in the 1920s, its foundersstressed the importance of lavishing on business records thesame reverence that political historians accorded the personalpapers of lawmakers. Only in this way, business historians assumed,would it be possible to convince other historians of the centralityof business leaders—and, more broadly, of economic institutions—tothe making of the nation. Much has changed since the 1920s. Yet the adversarial relationshipof business historians toward political history persists. Thismindset is evident     

Gordon Boyce. Over Half a Million Careful Owners: A 75-year history of PSIS, 1928-2003. Wellington, NZ: Dunmore Publishing, 2005. 326 pp. ISBN 0-476-0129-29, NZ$29.95 (paper).

Gordon Boyce traces the history of New Zealand’s PSIS,the Public Service Investment Society, in a book commissionedby the company. Boyce, now Professor of International Businessat Queensland University of Technology after thirteen yearsof teaching business and economic history at Victoria Universityof Wellington, is well qualified for the project. His recentpublications include Co-operative Structures in Global Business(2002). Boyce fulfills his commission well, narrating an engagingstory. "Vignettes" provide personal and anecdotal details thatformer staff     

Alfred Chandler and the Importance of Organization

Alfred D. Chandler entered my professional life incrementallyrather than dramatically. As a student of economic history atCambridge University in Britain in the early 1970s, I barelyencountered his name. British universities had their own longtraditions in business and economic history, including a stronginterest in entrepreneurship and in government policies towardindustry. Most British scholars were not especially enthusiasticabout ideas from across the Atlantic, whether the methodologicalapproach of the new economic history of Robert Fogel, or Chandler'sorganizational synthesis. Cambridge was an especially closedacademic world, with a strong assumption that little that happenedoutside its delightful campus could be really important. Itwas not until 1979, when     

Cross-cultural Comparisons of Managerial Perceptions on Profit

The study investigated the effects of three cultural variables – country of employment, race/ethnicity and religion – on managerial views of profit and 15 other business priorities. In total, 203 responses were obtained (120 randomly and 83 by quota) from executives and managers belonging to either of two race/ethnic groups (Caucasian and Chinese) and three religious denominations (Christian, Buddhist and Malay Muslim) located in three different countries (Australia, Singapore and Malaysia). Findings indicated that these three different cultural variables affected (to varying degrees) the attitudes of managers towards profit and other related business concerns. Managers working in Malaysia, the Malay Muslims and Caucasians in particular, had the highest regard for profit whilst those employed in Australia were found, on the whole, to be the most (socially) considerate toward their employees, customers and environment. This study pointed to the need for cultural ethics as a complementary function in business. After majoring in Psychology and Sociology in the Bachelor of Arts (Multidisciplinary) Program at Victoria University, I went on to do my Master of Arts in Applied Social Research at Monash University. With these given areas of specializations and with the support of a scholarship from Victoria University, I was able to complete my doctoral studies in business ethics and foreign labour employment in 2006.     

Ivan T. Berend. An Economic History of 20th Century Europe: Economic Regimes from Laissez-Faire to Globalization

If economics is the dismal science, it should be no surprisethat economic history—with its many statistics and tables—hasfew opportunities for lyrical flourishes to avoid becoming dismalreading. Ivan Berend's very competent economic history of Europein the twentieth century makes a great effort to overcome thisgeneric failing with lively analysis and interesting asides. While providing a rich assortment of good comparative statisticsand clear graphics, Berend does an excellent job of integratinghis economic story into     

Hirschman’s Rhetoric of Reaction: U.S. and German Insights in Business Ethics

In recent times, representatives of American management science have been arguing increasingly for a functionalization of ethics to change economic thinking: what they are seeking is the systematic integration of ethics into the economic paradigm. Using the insights developed by Hirschman, I would like to show how one must first expose the rhetoric of those critics of change (referred to below as conservatives or reactionaries) in order then to implement that which is new (representatives of this approach are referred to below as progressives). Such an ‹unmasking’ works particularly well when one can defuse the arguments of the reactionaries – which is precisely what one achieves by strategically integrating ethics into economics. In his work The Rhetoric of Reaction Hirschman examines three basic forms of reactionary thought: the perversity thesis, the futility thesis, and the jeopardy thesis. According to the perversity thesis, intended goals are transformed into their opposites. The futility thesis argues that the setting of goals is useless since history runs its own course independent of those goals. The jeopardy thesis claims to preserve what already exists since change might substantially endanger that which has already been achieved. The importance of Hirschman’s ideas for the strategic interplay between the academic disciplines can be seen quite clearly in the example of German business ethics. This will be displayed below with reference to Hirschman’s three theses. Finally, implications will be drawn for business ethics in general and for management theory in particular.     

Speculative attack against the Hungarian forint

In mid-January 2003 a severe speculative attack was launched against the exchange rate of the Hungarian forint. The attack was very unusual in the history of foreign exchange speculations, since it was aimed at enforcing the appreciation — and not the depreciation — of the currency targeted. The specific nature of this kind of speculation is closely related to Hungary’s accession to the European Union in general and to EMU in particular. Since the other Central and Eastern European acceding countries face similar problems and challenges, the Hungarian experience may involve some instructive lessons on monetary and economic policy for them too.     

The Baltics: Continuing Boom or Bursting Bubble?

Since the late 1990s, the economies of Estonia, Latvia and Lithuania have experienced unprecedented economic growth, which has attracted a large number of foreign investors. American companies were among the first to seek business opportunities and have invested over $1 billion in the three countries as of 2008. However, the boom—partly financed on a loose credit policy—has recently created a fragile economic situation due to soaring wages, double-digit inflation, and high current account deficits. The resulting economic deceleration in the first half of 2008 has led analysts to comment that the “Baltic Bubble” is about to burst, potentially leading to a long-term recession. Other experts, nevertheless, maintain that the three countries are only experiencing a natural consolidation, which does not seriously endanger business opportunities in the long run. The purpose of this paper is to analyze the current condition of the Baltic economies and the environment for businesses there in order to determine if the three countries will still be attractive destinations for foreign direct investment (FDI) in the future.     

Price V. Fishback et al. Government and the American Economy: A New History

In Government and the American Economy: A New History, a distinguishedpanel of economic historians chronicles and evaluates how governmenthas shaped U.S. economic development and growth from the colonialperiod to the present. The volume is dedicated to Robert Higgs,whose seminal thesis on the growth of government—thatit is a crisis-induced and persistent process—is one ofthe volume's underlying themes (and the subject of Higgs’chapter titled, "The World Wars"). The other is that government     

Frederick H. Smith. Caribbean Rum: A Social and Economic History

Frederick Smith's early evocation (p. 2) of Sidney Mintz's 1985master-work Sweetness and Power: The Place of Sugar in ModernHistory is most unfortunate because Smith is no Mintz—exceptthat they are both anthropologists. This sad little book suffersby comparison on most every page. In contrast to Mintz, it isnot good social history, it is not good economic history, andit is not good anthropology. More particularly for readers ofEnterprise Society, Caribbean Rum is not good     

Revealing Entrepreneurial Talent

A society’s allocation of working time to entrepreneurial, organizational and learning activities is the main factor behind technical change and economic growth. Building on Lucas (1978) and Kihlstrom and Laffont (1979), in this paper I offer evidence that the amount of working time spent by small business owners in entrepreneurial activities affects the performance of the business and reveals their entrepreneurial talent. The intuition is that it is reasonable to allocate more of our time to those activities where we realize we are more productive. As actual consumption choices reveal consumer preferences, the varying entrepreneurial content of the activities performed is a signal of an individual’s ability as entrepreneur. The results obtained suggest that the allocation of working time by small business owners: (a) throws light on their behavioral patterns; (b) is related to the owner’s human capital and to firm size; and (c) has a significant correlation with business performance. The main finding of my analysis, confirming previous studies on this topic, is that education is an important part of entrepreneurial human capital. Moreover, the latter is the main factor that can sustain small firms’ competitiveness in a globalizing economy. The entrepreneur is at the same time one of the most intriguing and one of the most elusive characters in the cast that constitutes the subject of economic analysis (Baumol, 1965, p. 64). I would like to acknowledge valuable comments from T. Cameron, G. Gagliani and two anonymous referees. The usual disclaimer applies.     

Franco Amatori and Geoffrey Jones, eds. Business History around the World. New York: Cambridge University Press, 2003. xv + 425 pp. ISBN 0-521-82107-X, $65.00.

This important cluster of perspectives on practice and prospectin business history derives from a fall 1998 colloquium heldat Bocconi University in Milan, sponsored jointly by the Institutefor Economic History, the Italian Association of Business Historians(ASSI), Reading University, and Johns Hopkins University. Thecollection echoes its support team’s transnational diversity,presenting an opening set of conceptualizing essays, elevenconcise national/regional overviews, and four closing chaptersthat identify themes for comparative business history. Botha snapshot of the discipline’s preoccupations in the late1990s and a handbook of historiography and work then in progress,Business History around the World is a volume every referencelibrary should own. For practicing historians and graduate students,in my view, parts one and     

False Promises? A Sociological Critique of the Behavioural Turn in Law and Economics

Economic bestsellers like Freakonomics and Nudge that mainly address outsiders of the economic discipline are also consumed by lawyers. The latter has already become an important reference in the field of consumer law and policy. In principle, this is nothing to complain about but part of law’s encounter with science, namely the social sciences. Notably, the law and economics movement proved successful in importing economic perspectives into legal discourse. However, it would seem questionable if the law followed each trend on the academic book market. While there has been an increasing emphasis on economic perspectives at the expense of sociological perspectives within the field of law, economy, and society, a major shift can now also be observed in the field of law and economics. With the behavioural turn in law and economics, homo oeconomicus seems to be transformed into Homer Economicus, and consumer law prone to be Simpsonized. In this paper, the turn from neoclassical law and economics to behavioural law and economics will be analysed from a third, namely sociological perspective: the economic sociology of law. In this framework, it is possible to compare and confront the “old” homo oeconomicus rationalis and the “new” homo oeconomicus behaviouralis with a third model—homo oeconomicus culturalis—which demonstrates the limits of the previous models, not least with regard to explaining the recent financial crisis. While governance by nudges might look, at first sight, as a tempting idea, I will question the normative side of this project and emphasize its possible effects on our legal culture and, thereby, our human condition.     

Economic impact of a private sector micro-financing scheme in South Dakota

While poverty rates on Native American Indian reservations are triple the US average. Small business incubation programs, available elsewhere in the US, scarcely exist on the Native American Indian Reservations (NAIRs). Our unique study tests the effects of the Lakota Fund (LF), a private sector small business development initiative on the Pine Ridge Reservation in South Dakota, on the economic development of the NAIRs. Our objective is to determine whether the SBA-like programs (loans, training, and consulting) can improve economic conditions. The 1980–2006 annual county-level (Shannon Co. is ‘treatment,’and Todd Co. is ‘control’) data are a natural experiment. Results indicate that the LF inception and duration significantly raised real per capita income (RPCI)—suggesting not only the success of the LF, but support for the broader notion that privately funded small business initiatives can be used to support economic development of isolated impoverished groups within the US economy.     

Applying Stories of the Environment to Business: What Business People Can Learn From the Virtues in Environmental Narratives

The use of narrative to communicate and convey particular points of view in society has increasingly become the focus of academic attention in recent years. In particular, MacIntyre. (1985, 1988, 1990, 1999) has paid attention to the role of narrative in the conflict between different traditions when developing his virtue approach to ethics. Whilst there has been continued debate about the application of virtue approaches, some arguing that it is incompatible with business, I disagree and have already argued for a form of virtue that will focus business on society’s needs rather than better business itself. Here I continue to develop the argument in two ways. First, I will explore the predominant business narrative and offer some comment on the ‘virtues’ that it promotes. However, rather than accepting this narrative, I want to challenge it with a narrative from the environmental tradition. I consider how adopting the virtues promoted by an environmental narrative it would shape business practices and challenge current business conventions. As a second step, I will focus on how we can change managers’ perceptions of business to reflect these environmentally based virtues.     

Barry Shank. A Token of My Affection: Greeting Cards and American Business Culture. New York: Columbia University Press, 2004. xvii + 328 pp. ISBN 0-231-11878-3, $50.00 (cloth).

Barry Shank has written a history of commercially produced greetingcards in the United States. Using vocabulary, concepts, andthe terrifically long sentences common to cultural studies,Shank argues that greeting cards reveal the emotional life ofcard-buying Americans. That inner life, he argues, was fundamentally"conditioned" and "structured" by American business culture.Many business historians will find Shank’s book challengingto read and not always convincing. If they persevere, and occasionallysuspend empirical demands, they will     

A personalized teaching signature: Finding your unique profile as a business educator

Is there a model of the ideal business school instructor? I asked myself this question many times when first teaching in a business school classroom. Assessing the style and approach of other effective instructors signaled that there are many models for success in the classroom, but how should I think about developing my own successful teaching style and approach? To address this challenge, I developed the concept of the personalized teaching signature, which accounts for teaching as a complex, multidimensional activity that includes preparation, practicality, rigor, entertainment, empathy, experiential engagement, enthusiasm, novelty, and surprise. I argue that an instructor should strive to exceed an expected threshold of proficiency in each teaching dimension and then focus on specific dimensions in which they can excel to develop a personalized teaching signature. In this article, I describe the concept of a personalized teaching signature, outline its basic dimensions, and offer a step-by-step process for using this signature to become a better business school instructor.     

A Proposal for the Efficient Taxation of All Business Income in the EU

There is a growing awareness in many EU member states that business taxation solely on the basis of “taxable profits” enables, in particular, multinational companies to avoid paying taxes, with negative consequences both for tax revenue and—in the longer run—also for the stability of the economy. The following article proposes the taxation of all compensation of capital—not only profit for equity, but also interest for outside capital and licence fees for outside rights—at the site of production.