Hostname: page-component-586b7cd67f-t7czq Total loading time: 0 Render date: 2024-11-24T07:47:33.975Z Has data issue: false hasContentIssue false
  • English
  • Français

Mass Production Conquers the Pool: Firm Organization and the Nature of Competition in the Nineteenth Century

Published online by Cambridge University Press:  03 March 2009

Margaret Levenstein
Margaret Levenstein
Affiliation:
Assistant Professor of Economics, University of Michigan, Ann Arbor, MI 48109-1220.
Get access Rights & Permissions [Opens in a new window]

Abstract

This article uses the records of the Dow Chemical Company to analyze the role of distributors in facilitating collusion in the late nineteenth and early twentieth centuries. It compares collusion in three closely related markets: salt, bromine, and bleach. Where national distributors with well-established reputations had facilitated the entry of small producers into integrated markets, distributors could also facilitate collusion. Mass-producing entrants, like Dow, joined collusive distribution arrangements while improving their innovative production processes. In the longer run, they integrated forward to escape the output restrictions and arms-length relationship with customers imposed by collusive agreements.

Type
Articles
Information
The Journal of Economic History , Volume 55 , Issue 3 , September 1995 , pp. 575 - 611
Copyright
Copyright © The Economic History Association 1995

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

REFERENCES

Abreu, , Dilip, , Milgrom, Paul, and Pearce, David. “Information and Timing in Repeated Partnerships.” Econometrica 59, no. 6 (1991): 1713–33.Google Scholar
Bezanson, , Anne, D. Gray, Robert, and Hussey, Miriam. Wholesale Prices in Philadelphia 1784–1861. Philadelphia: University of Pennsylvania Press, 1937.Google Scholar
Bownocker, , Adams, John. “Salt Deposits and the Salt Industry in Ohio.” Geological Survey of Ohio Fourth Series. Bulletin, no. 8 (1906).Google Scholar
Chandler, Alfred D. Jr. The Visible Hand. Cambridge, MA: Harvard University Press, 1977.Google Scholar
Chandler, Alfred D. Jr. Scale and Scope: The Dynamics of Industrial Capitalism. Cambridge: The Belknap Press of Harvard University Press, 1990.CrossRefGoogle Scholar
Chemical Week, 16 08 1992.Google Scholar
Clark, , S., VictorHistory of Manufactures in the United States, 1860–1914. Washington, DC: Carnegie Institution of Washington, 1928.Google Scholar
Dewing, , S., ArthurCorporate Promotions and Reorganizations. Cambridge: Harvard: University Press, 1924.Google Scholar
Eskew, , L., GarnettSalt: The Fifth Element. Chicago: J. G. Ferguson and Associates, 1948.Google Scholar
Fost, Carolyn Ann. “The Salt Industry: A Case Study in the Evaluation of Public Policy.” Ph.D. diss., Southern Illinois University, 1970.Google Scholar
Grimsley, G. P. Iron Ores, Salt and Sandstone. West Virginia Geological Survey. Vol. 4 (1901).Google Scholar
Haber, L. F. The Chemical Industry During the Nineteenth Century: A Study of the Economic Aspect of Applied Chemistry in Europe and North America. Oxford: Clarendon Press, 1958.Google Scholar
DrHale, John Peter. “Salt Manufacturing in the Kanawha River Valley.” In Resources of West Virginia, edited by Maury, Matthew and Fontaine, W. N., 274–305. Wheeling, WV: The Register Company, 1876.Google Scholar
Hardie, D. W. F. A History of the Chemical Industry in Widnes. Birmingham: Imperial Chemical Industries Limited, General Chemical Division, 1950.Google Scholar
Haynes, Williams, . American Chemical Industry: Background and Beginnings. Vol. 1. New York City: D. Van Nostrand, 1954.Google Scholar
Jenks, J. W. “The Michigan Salt Association.” In Trusts, Pools and Corporations, edited by Ripley, W. Z., 1–21. Boston: Ginn & Company, 1916.Google Scholar
Lamoreaux, , R., NaomiThe Great Merger Movement in American Business, 1895–1904. Cambridge: Cambridge University Press, 1985.Google Scholar
Lazonick, , William, . Business Organizations and the Myth of the Market Economy. Cambridge: Cambridge University Press, 1991.Google Scholar
Leavitt, , Keith, Robert. Prologue to Tomorrow: A History of the First Hundred Years in the Ljfe of the Pennsylvania Salt Manufacturing Company. Philadelphia: The Pennsylvania Manufacturing Company, 1950.Google Scholar
Levenstein, , Margaret, . “Information Systems and Internal Organization: A Study of the Dow Chemical Company, 1890–1914.” Ph.D. diss., Yale University, 1991.Google Scholar
Levenstein, , Margaret, . “Vertical Restraints in the Bromine Cartel: The Role of Distributors in Facilitating Collusion.” NBER Historical Paper No. 49, Cambridge, MA, 07 1993.CrossRefGoogle Scholar
Levenstein, , Margaret, . “Price Wars and the Stability of Collusion: A Study of the Pre-World War I Bromine Industry.” NBER Historical Paper No. 50, 09 1993.CrossRefGoogle Scholar
Levenstein, Margaret. “The Determinants of Bargaining Power in an International Cartel: Dow and the Deutsche Bromkonvention, 1908–1914. Unpublished Manuscript.Google Scholar
Mahoney, , Tom, . The Merchants of Life: An Account of the American Pharmaceutical Industry. New York: Harper & Brothers, 1959.Google Scholar
Oil, Paint and Drug Reporter [Superseded by the Chemical Marketing Reporter, various dates.Google Scholar
Penrose, T, Edith. The Theory of the Growth of the Firm. Oxford: Basil Blackwell, 1963.Google Scholar
Porter, , Glenn, , and C. Livesay, Harold. Merchants and Manufacturers: Studies in the Changing Structure of Nineteenth Century Marketing. Chicago: Ivan R. Dee, Inc., 1971.Google Scholar
Post Street Archives (PSA). Herbert Dow Papers. Midland, MI.Google Scholar
Reader, W. JImperial Chemical Industries: A History. Vol. 1. The Forerunners, 1870–1926. London: Oxford University Press, 1970.Google Scholar
Stealey, , E., JohnThe Antebellum Kanawha Salt Business and Western Markets. Lexington: The University Press of Kentucky, 1993.Google Scholar
Stout, , Dumas, George. Edward Mallinckrodt: A Memoir. St. Louis: Privately published, 1933.Google Scholar
Sturchio, , L., Jeffrey, ed. Values and Visions: A Merck Century. Rahway, NJ: Privately published, 1991.Google Scholar
Sutton, , John, . Sunk Costs and Market Structure: Price Competition, Advertising, and the Evolution of Concentration. Cambridge, MA: The MIT Press, 1991.Google Scholar
Thomas, , E., RobertSalt and Water, Power and People: A Short History of Hooker Electrochemical Company. Niagara Falls, NY: Hooker Electrochemical Company, 1955.Google Scholar
Ulen, , Thomas, . ”Cartels and Regulation: Late Nineteenth Century Railroad Collusion and the Creation of the Interstate Commerce Commission.” Ph.D. diss., Stanford University, 1979.Google Scholar
U.S. Bureau of the Census. Census of Manufactures. Washington, DC: GPO, 1880.Google Scholar
U.S. Department of Commerce. Historical Statistics of the United States: Colonial Times to 1970. Part I. Washington, DC: GPO, 1975.Google Scholar
Weiss, , B., HarryThe Revolutionary Saltworks of the New Jersey Coast. Trenton, NJ: Past Times Press, 1959.Google Scholar
Wright, , Gavin, . “The Origins of American Industrial Success, 1879–1940.” American Economic Review 80, no. 4 (1990): 651–68.Google Scholar