Business History

Published by Taylor & Francis (Routledge)
Print ISSN: 0007-6791
Publications
This article examines the cotton manufacturing industry in Lombardy during the period when Austrian rule was being restored in the wake of the Congress of Vienna. It adopts Pollard's emphasis on the regional nature of industrialisation, drawing on the surviving accounts of Francesco Saverio Amman - the Austrian-born founder of a major cotton-mill - and attempts to identify differences and similarities between his career and achievements and those of his many counterparts in the rest of Europe. The article begins by looking at Amman's economic and social advancement, and then discusses the development of his business interests. It concludes by examining how he chose to invest his earnings, both within and without the cotton industry.
 
The "improved public house" movement in the inter-war years was a central part of the shift towards retailing by the brewing industry. An important part of the reform movement was the alliance between certain brewers, notably Whitbread, and "social workers", particularly those associated with the University Settlement movement in London. Using the papers of Sydney Nevile, the importance of a particular social milieu is outlined, calling into question attempts to align the movement to improve public houses with transatlantic Progressivism. Rather, this alliance drew upon longstanding English traditions of public service and religious affiliation amongst a fraction of the gentry.
 
In 1931 the British government introduced pioneering legislation to combat occupational disease in the asbestos industry. A key feature was an Asbestosis Scheme for compensating workers for industrial injury and death. This article examines the implementation of the Scheme at Turner & Newall, the leading UK asbestos producer. The evidence reveals an inequitable system of compensation, especially when compared to the company's generosity to its shareholders. Deficiencies in British compensation law, the weaknesses of regulatory forces, and the company's policy of minimising the extent of asbestos disease are held responsible.
 
This study of Raleigh Industries, one of the leading bicycle manufactures in the world in the immediate post-war years, argues that its business strategy was in part shaped by a managerial commitment to a dominant company culture which was deeply embedded in Raleigh's history. Using the notion of culture as metaphor, the paper examines the way that core values in the company acted as a guide in the setting of organisational goals and, intended or unintended, impinged upon company performance. In many respects, the culture guided the company well, but our study shows a number of ambiguities, tensions and contradictions between culture and strategy which had negative effects on company behaviour. Thus, Raleigh's attachment to personal capitalism constrained its capacity expansion programme, and, while it adopted what appeared to be a progressive education and training policy, it in effect trained workers for the past rather than the future.
 
Keywords: advertising; marketing; affluence; austerity Advertising as a proportion of national income rose from the late 1940s and peaked in the mid-to-late 1950s. This growth however exhibited inflection points in 1949 and 1951 which coincided with political economy shifts. During this period of growth all sectors producing consumer goods increased expenditure on advertising; expenditure on advertising by the tobacco, and the clothing and footwear sectors rose the most relative to consumer spending on these product categories. From the mid-1950s, advertising of household goods, a category which included electrical durables and furniture, rose at the fastest rate.
 
According to neo-liberal economists such as Friedman and Hayek, the prime function of any business enterprise is to generate profits; its central responsibility is to shareholders. The idea that business owners should also seek to perform social tasks is regarded as completely erroneous. Historical evidence suggests that not all business leaders have been content simply to perform a commercial role in society. Numerous industrialists and entrepreneurs throughout the nineteenth century made significant contributions to their local communities. The early efforts of socially responsible business leaders are well documented. This paper aims to build on existing historical analysis of business philanthropy and social involvement by analysing developments in post-war Britain. Three main historical developments are outlined. Firstly, the early post-war years, despite the formation of the welfare state, witnessed some notable efforts to engage business in society. These were mainly inspired by church-led organisations and Christian entrepreneurs. Second, the expansion of the corporate economy throughout the 1940s and 1950s placed increasing constraints on the social aspirations of businesses. Finally, from the mid-1970s onwards there grew a more general interest in corporate responsibility. This was consolidated in the 1980s. As part of the general redefinition of state functions in this period, the role of business in addressing social problems became more prominent. Such political and policy developments, it is argued, have made a significant contribution towards enhancing the social role of business.
 
In the Lancashire cotton textile industry, mule spinners were prone to a chronic and sometimes fatal skin cancer (often affecting the groin). The disease had reached epidemic proportions by the 1920s, which necessitated action by the government, employers, and trade unions. In contrast to previous accounts, this article focuses on the government's reaction to mule spinners' cancer. Using official records in the National Archives, the slow introduction of health and safety measures by the government is explored in detail. Although obstructionism by the employers played a key role, one of the reasons for government inaction was the ambiguity of scientific research on engineering oils. On the other hand, prolonged scientific research suited a government policy that was framed around self regulation - a policy that had proved largely ineffective by the 1950s.
 
This article examines the economic developments that induced producers to seek our innovations during a transformative period in the Yorkshire woollen industry. The analysis examines both the increase in the scale of the typical operation and the tremendous effect that fashion had on the industry. Particular attention is given to the ways in which the workings of real markets and product innovation focused entrepreneurial energy on the production process, and what that tells us about the origins of the Industrial Revolution.
 
Two major debates in the literature, productivity performance and the decline of the cotton industry, are joined in the analysis presented in this article on the attempts to raise productivity through the introduction of the more looms per weaver system in cotton weaving in the inter-war years. We find that the limited resultant changes were the outcome of understandable predisposition to maintain co-operative behaviour which meant that productivity enhancing schemes with long term potential were sacrificed for more modest schemes which preserved consensus in the short term.
 
Location is an important aspect of retailing, and London entrepreneurs recognized it as early as the 1560s in building exchanges to house a collection of shops, taking them off the street. These shopping centres created a special shopping environment: shelter, safety, and shop agglomeration. Soon shoppers put on their own social display there, a further shopping attraction. Up to five of these centres existed in late seventeenth-century London, capturing about half of all shops. But the reputation of these facilities declined over time, the institution of shopping 'mall' apparently not continued or emulated again until the twentieth century.
 
In 1913 Otto Mønsted A/S, Denmark's leading margarine manufacturer, acquired a majority share in Fennia, a small and insignificant Finnish margarine company. The Danish company had extensive knowledge of all functional aspects of margarine, and had up to 1909 been a dominant player in the British margarine industry. In spite of the massive international experience that had been accumulated by Otto Mønsted A/S the Finnish venture turned into a disaster, because for all their experience the Danish managers committed an impressive range of failures. The work of N. Nohria and S. Ghoshal is applied to the case, and a theoretically consistent analysis is provided. The conclusion of the paper is that the analytical framework of Nohria and Ghoshal serves well in this respect. It is further shown that value-added chain analysis is useful in linking functional failures to a corporate governance perspective. In the final resort, World War I killed off the experiment, but it was doomed anyway. Almost 100 years have passed, but today managers have lessons to learn from this event.
 
There is a general acknowledgement, re-stated at the start of this book that the economic development of Britain from an agrarian, feudal society to an industrial, capitalist one was largely led by estate owners. Estates in the eighteenth and nineteenth centuries were the largest, most defined type of business organisation in existence, and formative industrial developments in mining and transportation came through landowners investing in their land, and retaining the rights and rewards from those investments. Accounting historians in particular have interrogated the records from estates to show how estate management practices were disseminated from an agricultural setting to other, industrial sectors. The extent to which those practices are the forerunners of modern management accounting practices is much debated. It has been held that modern accounting practices began during and after World War I but others have pointed to estate practices in the Middle Ages as the progenitors of modern management accounting. This book sits between the two periods, and is thus well placed to explore this issue. By David Oldroyd, Aldershot, Ashgate Publishing Limited, 2007, xii + 217 pp., £55.00 (hardback), ISBN 978-0-7546-3455-3
 
We investigate the early development of English cotton spinning by analysing about 700 bankruptcies and 1300 dissolutions of partnership reported in the London Gazette, 1770-1840. The data show three temporal cycles, peaking in the early to mid-1800s, in the later 1820s and again in the later 1830s, near the ends of investment booms. Both earlier peaks were absolutely higher than the later ones, despite industry expansion. Over time both bankruptcies and dissolutions show rising concentration of spinning in greater Lancashire, and within greater Lancashire in the surrounding towns rather than in Manchester. The industry was throughout dominated by single proprietors or firms with only two partners. Integration with weaving was increasing steadily. The paper demonstrates the potential of the Gazette, now searchable online, as a source for business and industrial history.
 
Recent accounts of nineteenth-century industrial organisation have presented the family firm as a secure environment in an essentially low-trust business environment. This article considers the transition of the textile engineering industry from an artisan trade of the late eighteenth century to one centred upon factories from the 1820s. Business networks were much more than casual links outside individual firms, but made up a central part of the industrial structure and operated in a collaborative, rather than a competitive, framework. In contrast, experiences of engineers within family firms illustrate that relationships within those firms were not guaranteed to be less problematic than with members of the surrounding community.
 
Focusing on government-business relations, this article contributes to the business history of the First World War. It examines how the linen industry was organised to meet military demand in both continental Europe and the UK. The German occupation of Belgium and northern France, and the consequent exploitation of raw material and manufacturing capacity, is an important theme. The article considers how the UK and Russia organised linen production and the role of establised Anglo-Russian commercial networks (including accountary firms) in facilitating wartime trade. Of major significance during the war was Trading with the Enemy legislation, and the article examines this in some detail before going on to look at the impact of government policy on the labour market at regional level. The article concludes that the war created new problems for the industry which contributed further to its secular decline.
 
The growth of the Atlantic economy during the eighteenth century has been associated with developments in business networking to mitigate the hazards of communication in long-distance trade. Such social capital-based mechanisms reduced transaction costs, but also proved to have their limitations in the changing conditions of eighteenth-century international trade. This paper argues, using the example of the British slave trade, that efforts to innovate less personalised forms of commercial exchange gave those prepared to do so a considerable competitive advantage, and promoted the unprecedented expansion of that trade between 1750 and 1807. We suggest that this shift may be viewed as a precursor of modernising tendencies in business practice in Britain during the industrial revolution.
 
The Americas' share in world exports from the United Kingdom, 1815-1899: shares from declared value series.
British textile exporters have supplied South America since well before the Napoleonic Wars. However, only from the 1810s onwards did British merchants establish houses in the region, quickly mastering the market. As far as the demand for coarse cloaks was concerned, both creoles and natives stuck firmly to ponchos. Because of the intrinsic characteristics of ponchos, local demand led British supply and, in an innovative process of adaptation, British manufacturers exported ponchos on a considerable scale to the markets of southern South America.
 
This article analyses three sources of financial data recording details of bills of exchange and promissory note transactions in the New South Wales (NSW) colony, 1817-20. These sources are the minute books and the customer accounts ledger of the Bank of NSW, and the records of the Supreme Court of Civil Jurisdiction, Sydney. We show how documentary credit was employed to balance debt in a currency-deprived colonial society. The analytical perspective is microeconomic, using the lens provided by the transactions of the convicted Margate embezzler and Sydney dealer, John Croaker. An eight-step protocol is introduced to show how to calculate conservative money-denominated estimates of turnover and 'profit' for traders in the colony. This protocol has potential to provide important commercially related dimensions to the biographical profiles of dealers, traders and merchants - not only in NSW, but in similar societies as well.
 
An organised market for financial securities in Montreal prior to 1874 developed slowly because finance of major infrastructure projects was carried out in London, not Montreal. Growth was not driven by speculation or tempered by successive boom and bust; this makes the Montreal experience practically unique in the history of finance. The Montreal Board of Trade was the focus of commercial activities that eventually evolved through increased specialisation to a stock market. Some businessmen who called themselves brokers traded stocks and bonds for their own account but not on commission since trading volume was too low for any form of auction to take place.
 
This article uses social network analysis to examine accounting records in order to establish and analyse business relationships. It applies this methodology to accounting transactions recorded at Australia's first bank, the Bank of New South Wales (BNSW) in order to establish whether a business network existed among ex-convict businesspeople in Sydney during 1817-24. Uncertainty regarding distance from suppliers and credit facilities, lack of markets and business connections plus the social stigma of 'convictism' meant that it was difficult but not impossible for ex-convicts to establish businesses. The network among BNSW shareholders and depositors served the purpose of pooling of resources and information and alleviating uncertainty.
 
This article describes the ways in which cotton goods were commercialised during the nineteenth century and the first third of the twentieth. Several national cases are analysed: Britain as the Workshop of the World; France, Germany, Switzerland and the US as core economies; Italy and Spain as countries on the European periphery; and Japan as a successful export latecomer. The main question that we address is why some cotton industries vertically integrated their production and selling processes, but others did not. We present a model that combines industrial district size and product differentiation to explain why vertical integration was present in most cases and why there was vertical specialisation of production and selling in Lancashire, Lowell and Japan.
 
Taking business decisions in large corporations requires the establishment of a competent network to channel information, permit the delegation of routine decisions, and assure the whole process is undertaken in the strictest confidence. Recent theories on social networks and the carrying out of the entrepreneurial function tackle these questions and constitute a new perspective for examining business cases. From this viewpoint, the present article seeks to analyse the entrepreneurial network established in Spain by the House of Rothschild between 1835 and 1931. It was a perfectly structured network that differentiated between agents, clientele, partners, and correspondents in a web of firms and institutions that allowed the Rothschilds to exercise their industrial and financial hegemony and consolidate themselves as the country's largest investor in the financial, industrial, railway and mining sectors throughout the stated period.
 
This paper uses original research on the roles played by two sets of foreign entrants into Chinese retailing since the 1850s - the overseas Chinese entrants and western entrants - to explore the psychic distance paradox over the long run. It explains how the advantages of psychic closeness in Chinese retailing have always been important in reducing entry barriers, but that the increasing costs of technology have increased the significance of firm proprietary strengths in some formats, notably supermarkets, so reducing the relative importance of psychic closeness. The paper therefore illustrates how taking the long-term perspective enables more sophisticated conclusions to emerge. A cross sectional analysis of one sector – Chinese supermarkets – would confirm the psychic distance paradox; overseas Chinese have been unable to translate psychic closeness into superior performance. By contrast their historic performance in department stores and more recently in fashion chains has been superior to the format leaders. This long term perspective therefore suggests that the understanding of the psychic distance paradox needs to be moderated by additional conceptualisation.
 
The role of 'opaque' networks are analysed within the context of an infant economy with low levels of corporate governance. A period of economic expansion is studied, documenting the effects of credit liberalisation. This article outlines the significance of networks, emerging business cliques, particularly around financial institutions and the interlocking directorates these affiliations allow. Their effects upon financial reporting, business credibility and its effects upon the network life cycle are considered. Market manipulation, the importance of monitoring in instances of unsophisticated governance structures and the agents used (but particularly local/national press) are all analysed.
 
This article studies financial schemes for building public works in the 1840s. The study of the Portuguese case clearly illustrates the importance of implicit contracts with governments in peripheral Europe, shedding light on solutions for financing the provision of public goods. Building roads and railways seems to have been the fruit of an implicit contract behind the tobacco monopoly in a country involved in social turmoil and civil wars. Reputation effects are called to explain the relevant range of the partners' negotiations, to reject the traditional historiography based on wrong management and speculation in a period of savage capitalism.
 
The operation of Liverpool public houses by the company Peter Walker & Son during the period 1846 to 1914 was distinguished by an adherence to their direct management, as opposed to the tenancy model espoused by most brewers in the period. The employment of managers was accompanied by detailed monitoring of performance, the construction of a managerial hierarchy and a focus on the appearance of the houses, features which reinforce the predominantly retail orientation of the company. This distinctiveness is related to broader features of the Liverpool context to argue that an institutionalist approach that gives due weight to both economic and cultural factors is needed in exploring the development of management practice.
 
This essay draws on the first systematic study of foreign direct investment in British retailing up to the 1960s. It shows that while foreign multinationals were unimportant in British retailing overall, they dominated some retail trades. Moreover, these retail entrants were mostly not by retailers but by manufacturers. Their motives varied but were mostly seemingly related to their need to control distribution channels and build brands. Foreign retailers per se were actually relatively rare and mostly unsuccessful. In contrast to British manufacturing, therefore, foreign innovations were not by and large introduced into British retailing by multinational enterprises. The article then explains why these foreign manufacturers of branded consumer goods pursued international marketing strategies that involved investing in costly retail outlets.
 
The shipping industry has been called 'the first globalised industry'. In this paper we analyse how domestic regulations have shaped the adaptations of ship owners in Norway, one of the leading providers of international shipping services for more than 150 years. The paper deals with the interaction between the international and domestic aspects of the shipping industry, with particular emphasis on demand (the market for shipping services), labour and capital. In particular, we discuss the relationship between international developments and the Norwegian regulatory regime.
 
This article describes a newly compiled dataset on foreign multinationals in British retailing and compares the patterns of inward investment in retailing with those in manufacturing. Foreign retailers were present in Britain well before foreign manufacturers, but their numbers did not grow as dramatically after 1890. Strikingly, very few pre-World War Two foreign entrants into UK retailing were actually retailers. The great majority were instead foreign manufacturers pursuing international markets through investing in dedicated distribution channels. These hybrid multinationals retained their home manufacturing base and mostly restricted their internationalisation to retailing.
 
Top-cited authors
Michael Rowlinson
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