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Notes for a Panel on Entrepreneurship in Business History

Published online by Cambridge University Press:  13 December 2011

Robert D. Cuff
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I want to begin with a question. Why did the historical study of entrepreneurship take such a decidedly “organizational turn” during the 1950s? One might have thought that a Research Center in Entrepreneurial History would have stimulated work on the individual entrepreneur; that it might have encouraged a focus on such questions as exactly why and how individual entrepreneurs created and sustained new businesses.

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Business History Review , Volume 76 , Issue 1 , Spring 2002 , pp. 123 - 132
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Copyright © The President and Fellows of Harvard College 2002

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References

1 Schumpeter is quoted in Swedberg, Richard, Schumpeter: A Biography (Princeton, N.J., 1991). 35Google Scholar. Swedberg adds: “That there exist some similarities between Schumpeter's heroic entrepreneur and Weber's charismatic leader is obvious.” See also Josephson, Matthew, The Robber Barons: The Great American Capitalists, 1861–1901 (New York, 1934)Google Scholar; and Allen, Frederick Lewis, The Lords of Creation (New York, 1935)Google Scholar. Business people featured in the HBS casebook included Robert Keayne, John Hancock, John Jacob Astor, Samuel Slater, Josiah Wedgwood, Cornelius Vanderbilt, James J. Hill, John Wanamaker, J. Pierpont Morgan, Elbert H. Gary, and Hugo Stinnes. See Gras, N. S. B. and Larson, Henrietta M., eds., American Business History (New York, 1939)Google Scholar. See also Porter, Kenneth W., Astor, John Jacob, Businessman (Cambridge, Mass., 1931)Google Scholar, and Larson, Henrietta M., Cooke, Jay, Private Banker (Cambridge, Mass., 1936)CrossRefGoogle Scholar.

2 Innis to Cole, “(no date–Oct'45),” in the Papers of Harold Innis, University of Toronto Archives.

3 New York, 196a; first published in Cambridge, Mass., in 1952.

4 Cole, Arthur H., Business Enterprise in Its Social Setting (Cambridge, Mass., 1959), 262 n. 10Google Scholar. In his original report to the Social Science Research Council in 1944, Cole promised support for individual business studies. However, he also indicated that “[i]n the large and economically dominant area of American business over which the large corporation has control, entrepreneurship is surely no longer the simple institution universally portrayed in the standard books of economic principles.” As a result, “it is in this difficult area of evolution in entrepreneurship that the Committee feels it should endeavor at least to blaze a trail.” “A Report on Research in Economic History,” Journal of Economic History 4 (May 1944): 63Google Scholar. “Our question was, what relevance did existing entrepreneurial theory, which assumed that decisions were made by individuals, have to businesses where decisions were made by teams or groups of managers.” From Carpenter, Kenneth E. and Chandler, Alfred D. Jr., “Fritz Redlich: Scholar and Friend,” Journal of Economic History 39 (1979): 1004CrossRefGoogle Scholar.

5 Quoted in McCraw, Thomas K., ed., The Essential Alfred Chandler: Essays Toward a Historical Theory of Big Business (Boston, Mass., 1988), 142Google Scholar. See also Aitken, Hugh G. J., “The Future of Entrepreneurial Research,” Explorations in Entrepreneurial History (Fall 1963): 3–9Google Scholar.

6 On the germination of Administrative Behavior, see Simon, Herbert A., Models of My Life (New York, 1991), 78–88Google Scholar. For a leading textbook in the field that illustrates the general interest in organizational constraints on individual behavior, see Simon, Herbert A., Smithburg, Donald, and Thompson, Victor A., Public Administration (New York, 1950)Google Scholar.

7 On the attractiveness of the social sciences to the historical profession during these years, see Saveth, Edward M., ed., American History and the Social Sciences (New York, 1964)Google Scholar; and Cochran, Thomas C., The Inner Revolution: Essays on the Social Sciences In History (New York, 1964)Google Scholar. See also Landes, David S. and Tilly, Charles, eds., History As a Social Science (Englewood Cliffs, N.J., 1971)Google Scholar. For the postwar quest for objectivity among U.S. historians, see Novick, Peter, That Noble Dream: The “Objectivity Question” and the American Historical Profession (New York, 1988), ch. 10CrossRefGoogle Scholar. Novick describes Thomas Cochran in 1950 as “[an] erstwhile socialist … who wanted to leave the field of business history because of uneasiness with the way in which the neutral social scientism he espoused tended to conflate ‘understanding, explaining, and approving,’ turning him into an apologist for a system he disliked” (p. 343). Steven Sass details the Center's internal theoretical debates in “The Fashioning of a Theory of Entrepreneurship,” ch. 3 of “Entrepreneurial Historians and History: A Study in an Essay in Organized Intellect,” Ph.D. diss., Johns Hopkins University, 1977Google Scholar. See also Boothman, Barry E. C., “‘The Central Figure in Economies’: The Rise and Fall of Entrepreneurial History,” Administrative Sciences Association of Canada, Proceedings 19 (1998): 23–35Google Scholar; Lee, C. H., “Corporate Behaviour in Theory and History, II: The Historian's Perspective,” Business History 32 (Apr. 1998): 163–79CrossRefGoogle Scholar; and Crandall, Ruth, The Research Center in Entrepreneurial History at Harvard University, 1948–1958: A Historical Sketch (Cambridge, Mass., 1960)Google Scholar.

8 Sicilia, David B., “Cochran's Legacy: A Cultural Path Not Taken,” Business and Economic History 24 (Fall 1995): 27–50Google Scholar. “It has fitted in with the needs of large-scale mass production,” Cochran wrote in 1965, “to give a particularly co-operative, team-like aspect to American entrepreneurship; one that is in quite striking contrast to the individual- and family-centrism of less industrially advanced areas.” From Cochran, , “The Entrepreneur in Economic Change,” Explorations in Entrepreneurial History 3 (Fall 1965): 27Google Scholar.

9 Quoted in Swedberg, Schumpeter, 173. Swedberg refers to Schumpeter's “new theory of the entrepreneur.” See also Schumpeter, , “Comments on a Plan for the Study of Entrepreneurship,” ch. 10, in The Economics and Sociology of Capitalism: Joseph A. Schumpeter, ed. Swedberg, Richard (Princeton, N.J., 1991)Google Scholar; and Schumpeter, , “Economic Theory and Entrepreneurial History,” in Aitken, Hugh G. J., ed., Explorations In Enterprise (Cambridge Mass., 1965), 45–64Google Scholar. In these articles, though, Schumpeter leaves lots of room for creative individual activity among his entrepreneurs.

10 As Barnard explained to a sympathetic reader in 1947: “My book was first published in 1938 and for a long time it looked to me as if no one would accept my view of organization as action and not people, although I have remained convinced that for my purposes of abstract theory this would prove in the end more convenient than the usual approach. You have adopted it and I think used it very effectively. Another man has also adopted it and if you do not know of his work, I can commend it. This is Professor Herbert A. Simon's ‘Administrative Behavior,’ published last month by Macmillan, for which I wrote an introduction.” Barnard to Andreas Papandreou, 30 Oct. 1947, Chester Barnard Papers, Baker Library, Harvard Business School. See also Cole, Business Enterprise, 10,137; and Scott, William G., Chester I. Barnard and the Guardians of the Managerial State (Lawrence, Kans., 1992)Google Scholar. “Simon,” Scott observes, “wrote mostly about limitations and restrictions to choice, as did Barnard” (p. 203, n. 36).

11 Boston, 1966.

12 American Historical Review 83 (Feb. 1978): 265CrossRefGoogle Scholar.

13 Chandler, Alfred D. Jr, The Visible Hand: The Managerial Revolution in American Business (Cambridge, Mass., 1977)Google Scholar.

14 “By the 1970's, … entrepreneurship was all but dead as a topic of interest to American historians.” See Corley, T. A. B., “The Entrepreneur: The Central Issue in Business History?” in Entrepreneurship, Networks and Modern Business, eds. Brown, Jonathan and Rose, Mary B. (Manchester, U.K., 1993), 14Google Scholar.

15 Chandler, Alfred D. Jr, Strategy and Structure: Chapters in the History of the Industrial Enterprise (Cambridge, Mass., 1962)Google Scholar. In these cases, “executive experience and personality helped determine the course and rate of structural adaptation and innovation.… Who saw the needs and who did not? And why? Who pushed for reorganization, and why?” (p. 349). “Complexity in itself, it should be emphasized, did not assure innovation or change; some responsible administrator had to become aware of the new conditions” (p. 369).

16 John, Richard R., “Elaborations, Revisions, Dissents: Alfred D. Chandler, Jr.'s The Visible Hand after Twenty Years,” Business History Review 71 (Summer 1997): 151–200CrossRefGoogle Scholar.

17 Chandler suggests as much in a brief “Foreword” to The Entrepreneurs: An American Adventure (Boston, 1986)Google Scholar, by Robert Sobel and David Sicilia. For a more recent appreciation by Chandler of “entrepreneurial corporate managers” (p. 12), who, in addition to “personal wealth,” also “increased the competitive strength of their industries, and added to the productivity and growth of the nation's economy,” (p. 1), see Chandler, Alfred D. Jr, “Introduction: Entrepreneurial Achievements,” in Blout, Elkan, ed., The Power of Boldness: Ten Master Builders of American Industry Tell Their Success Stories (Washington, D.C., 1996)Google Scholar. On corporate entrepreneurship in management studies, see Covin, Jeffrey G. and Miles, Morgan P., “Corporate Entrepreneurship and the Pursuit of Competitive Advantage,” Entrepreneurship Theory and Practice 23 (Spring 1999): 47–63CrossRefGoogle Scholar.

18 Chandler, Alfred D. Jr, with the assistance of Takashi Hikino, Scale and Scope: The Dynamics of Industrial Capitalism (Cambridge, Mass., 1990)Google Scholar.

19 On the latter point, for example, see Church, Roy, “The Family Firm in Industrial Capitalism: International Perspectives on Hypotheses and History,” in Family Capitalism, eds. Jones, Geoffrey and Rose, Mary B. (London, 1993), 17–43Google Scholar. And for a more general reminder of the cultural dimension of business enterprise, see Lipartito, Kenneth, “Culture and the Practice of Business History,” Business and Economic History 24 (Winter 1995): 1–41Google Scholar.

20 New York, 1990.

21 Tedlow, New and Improved, 348–9.

22 Nancy F. Koehn, “Josiah Wedgwood and the First Industrial Revolution,” in McCraw, Creating Modern Capitalism, ch. 2; and Koehn, , “Henry Heinz and Late Nineteenth-Century Brand Creation: Markets for Processed Food,” Business History Review 73 (Autumn 1999): 349–93CrossRefGoogle Scholar.

23 Thomas K. McCraw (Cambridge, Mass., 1997).

24 Quoted in McCraw, Thomas K. and Cruikshank, Jeffrey L., eds., The Intellectual Venture Capitalist: John H. McArthur and the Work of the Harvard Business School, 1980–1995 (Boston, 1999), 267Google Scholar.

25 New York, 1998, 5.

26 New York, 1999. For an outline of contemporary business school topics in entrepreneurial studies, see Howard H. Stevenson and Teresa M. Amabile, “Entrepreneurial Management: In Pursuit of Opportunity,” ch. 5 of The Intellectual Venture Capitalist, eds. McCraw and Cruikshank. For a theoretical argument on behalf of the firm as an entrepreneur, see Casson, Mark, “Entrepreneurship and the Theory of the Firm,” in Entrepreneurship, Small and Medium-Sized Enterprises and the Macroeconomy, eds. Acs, Zolton J., Carlsson, Bo, and Karlsson, Charlie (Cambridge, U.K., 1999)Google Scholar, ch. 2. Livesay, Harold C. made a similar case from a historian's perspective, in “Entrepreneurial Persistence Through the Bureaucratic Age,” Business History Review 51 (Winter 1977): 415–43CrossRefGoogle Scholar.

27 For an example of contemporary efforts in management studies to define entrepreneurship as a research field, see Shane, Scott and Venkataraman, S., “The Promise of Entrepreneurship as a Field of Research,” Academy of Management Review 25 (Jan. 2000): 217–26Google Scholar. “To date,” write the authors, “the phenomenon of entrepreneurship has lacked a conceptual framework” (p. 217). They hope their suggestions “will prod scholars from many different fields to join us in the quest to create a systematic body of information about entrepreneurship” (p. 224).