In my book Scale and Scope (1990), I focused on the history of the modern industrial firm from the 1880s, when such firms first appeared, through World War II. I did so by comparing the fortunes of more than 600 enterprises—the 200 largest industrial firms at three points in time (World War I, 1929, and World War II) in each of the three major industrial economies (those of the United States, Britain, and Germany). In this paper, I first describe the similarities in the historical beginnings and continuing evolution of these enterprises and then outline my explanation for these similarities. Next, I relate my explanation of these "empirical regularities" to four major economic theories relating to the firm: the neoclassical, the principal-agent, the transaction cost, and the evolutionary. Finally, I suggest the value of the transactions cost and evolutionary theories to historians and economists who are attempting to explain the beginnings and growth of modern industrial enterprises.
The basic functions of the corporate headquarters (HQ) multibusiness firms are both entrepreneurial (value‐creation) and administrative (loss prevention). The development and implementation of these HQ functions reflect the industries in which the firms operate. Historically, the ability of the headquarters to carry out these functions has determined both the successful paths to growth for a multibusiness enterprise and the limits to that growth.
In this article, Professor Chandler compares and contrasts the emergence of managerial capitalism in the United States, Great Britain, Germany, and Japan. Though he observes that large firms tended to evolve according to a common pattern, he is equally impressed by international differences in the pace, timing, and character of change.
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