Published by EH.NET (September 1999)

Kenneth D. Brown. Britain and Japan: A Comparative Economic and Social

History Since 1900. New York and Manchester, UK: Manchester University

Press, 1998. xii + 259 pp. $79.95 (cloth), ISBN: 0-7190-5290-4; $27.95

(paper), ISBN: 0-5190-5291-2.

Reviewed for EH.NET by Michael Smitka, Department of Economics, Washington and

Lee University.

Kenneth Brown, Professor of Economic and Social History at the Queen’s

University of Belfast, provides us with an interesting and generally lucid

study, based on a close and thoughtful reading of the English-language

literature on Japan and his knowledge of the UK from his own work on British

labor history. Both, he finds, were island-nations offshore from major

continental powers. Neither had the size or the resources sufficient to

sustain development without trade. Both became imperial and naval powers, in

tension with neighbors and, oddly enough, with the U.S., on the far side of

their respective oceans. Both ended up in wars on their neighboring

continent. And both ended up successful in providing their citizens with a

high standard of living. Extending these comparisons, then,

is one of the book’s goals.

To that end Brown employs a four-fold framework of production,

reproduction, power and authority, and ritual. Useful insights result,

particularly in the political realm. While Japan is noted for the long-lived

rule of the conservative Liberal Democratic Party, the British political scene

was also dominated by conservative governments. In both

cases, this was due as much to disarray on the Left as to electoral success by

conservative parties. Nor is Japan unusual for the role of money and

corruption. Indeed, in the 1980s British Conservative MPs averaged four

corporate directorships and two corporate chairmanships, while facing no

requirement for financial disclosure.

The analysis of earlier eras likewise helps dispel the image of Japan as

backward politically. Parties there did not assert political power until 1918,

with Hara Kei’s formation

of a cabinet based on the Seiyukai’s strength in the lower house of the Diet,

followed by expansions of the franchise in 1919 and 1925. But the late onset of

“democracy” was not all that unusual. Even in the UK the franchise was limited

for men until 191 8,

and universal suffrage came only in 1928; mass-based political parties likewise

dated from the World War I era. However, Brown’s focus on a Left-Right split in

Britain does not extend to Japanese politics of that era, where the points of

departure between the two main parties were less ideological. The parallel is

thus less strong than is implicit in the author’s framework. Unfortunately the

book does not delve into the policy tensions between the “positive” economic

policies of the Seiyukai and the fiscally orthodox Kenseikai (later Minseito),

with its commitment to returning to the Gold Standard. (See Takafusa Nakamura,

A History of Showa Japan, 1926-1989, University of Tokyo Press, 1998.)

I, for one, would be curious to know if there was a similar

tension in the British political scene.

Most of the book, however, reflects the theme of learning from Japan. Brown

cites a 1990 essay by Michael Heseltine in the Independent. “The lessons

of Japan’s business success are no secret. They are there to be learned and

the UK has more to learn than most” (p. 5). He includes Britain in a

comparative historical framework to circumvent the “danger of confusing what

has been distinctive with what has been causally significant” (p. 5,

citing a work by Marsh and

Mannari). Ironically, Brown continues, “Finally,

there is no reason to assume that Japan’s success is permanent.” Given our

current perspective of a Japan mired in recession for the decade of the 1990s

–clearly not the author’s perspective at the time the book was written –this

is apropos. Indeed, we are cautioned that “in the U.S., where the

multidivisional structure was most fully developed, economic growth was not

particularly impressive by international standards …

Larger corporate size was not often matched by larger plant size [and mergers

reflected] corporate conspicuous consumption.” The book does go on about

problems with British education and corporate management, but in fact such

arguments are not pushed very far. Brown’s examination of Britain in the light

of Japan’s experience fails to provide a compelling explanation for British

exceptionalism on the corporate front.

Perhaps Britain was not exceptional. As noted, Brown wrote before the full

extent of Japan’s recent decline became apparent, and in apparent ignorance

that by 1980 there was public hand-wringing inside Japan of “hollowing out,”

the worry over the loss of manufacturing jobs — deindustrialization

— that the author shares with Heseltine. In one sense hollowing out is good,

in that it is the natural consequence of the secular increase in demand for

services that is found throughout the high-income countries, the provision of

which perforce requires a decline in manufacturing’s share of employment. But a

second source of comparative performance in manufacturing surely lies in

short-run macroeconomic conditions. The author’s analysis of such issues,

however, is impressionistic, even where data could readily be brought to bear.

One example is his criticism of Britain’s stop-and

-go macroeconomic policy, which in turn reflected the chronic balance of

payments problems that was tied to five recessions during the course of the

1950s and 1960s (p. 154). But Brown down-plays Japan’s similar experience with

balance of payments-induced

problems, which included a trip to the IMF in 1961. Indeed, quick calculations

show the variance of both nominal and real British GDP growth was much lower

than Japan’s, though in Japan’s case average growth was sufficiently high that

growth rates remain0ed positive even in such cyclical downturns. (See the note

below.) If one takes the perspective of a businessmen trying to plan for the

future, then neither country was a paragon of stability. I am thus skeptical

that “Japanese industry proved far more responsive than Britain’s to such

policies.”

The analysis is similarly weak with exchange rate issues, which surely affect

comparative manufacturing performance. Was the fixing of the yen at

$1 = Y360 in April 1949 really good, when Britain devalued the pound just

months later? After all, as just noted, Japan suffered chronic

balance-of-payments problems for most of the next two decades, and saw large

swings of the value of the yen in the 1980s and 1990s. Might not a stubborn

defense of the sterling prior

to the 1967 devaluation have been part of Britain’s problem? He also downplays

the role of exchange rates in his comparison of the interwar experience (pp.

50-52). Surely one source of Japan’s slow growth during the 1920s was a

stubborn attempt to return

to the gold standard, finally implemented in January 1930. Likewise, Japan’s

strong growth from 1933 was due in large part to the devaluation that followed

Japan’s departure from the gold standard in December 1932.

Elsewhere, Brown claims (p. 185) that “the best hope [of the UK] of escaping

the problems [of the 1970s] lay in exporting.” He undermines his own case,

however, by pointing out in the same section of the book that the main engine

of growth in Japan during the 1950s and 1960s was domestic demand

(p. 183) and that manufacturing in the UK was not the dominant source of

employment (Table 6-2, p. 182).

At the start of the volume, Brown tempers reader’s expectations for easy

lessons from “juxtaposing two societies at very different stages of

development.” The focus on institutional lessons, and the general lack of

careful

statistical comparisons accentuates these difficulties. In places his four-fold

framework makes it difficult to keep chronologies straight,

and the attention given to the various elements varies from era to era. The

book does nevertheless provide a ready overview of key political and economic

trends, and many thoughtful cautions for those seeking to make facile

comparisons. Despite his agenda of searching for lessons from Japan to

help Britain with its decline, the book is weakest when the author discusses

“deindustrialization,” and strongest when he compares industrial democracy.

Those sections — chapters 4 and 7 in particular — are fun, but the more

narrowly economic history portions are at best useful for the general

background they provide.

* My calculations. For Japan, the standard deviation was 2.4% (real growth)

and 4.4% (nominal), using annual data for 1955-1973. For the UK these were 1.7%

and 3.1%, respectively, using data for 1951-1973 (UK). (Official national

accounts data for Japan only begin in 1955.)

Michael Smitka is Associate Professor of Economics at Washington and Lee

University. He edited a 7-volume series of reprints, Japanese Economic

History, 1600-1960

(Garland Press, 1998). With the new semester starting he is mainly teaching,

but in his spare time he will continue work on the automobile industries in the

US and Japan during the past two decades.

Published by EH.NET (September 1999)

Ellen Furlough and Carl Strikwerda (eds.). Consumers Against Capitalism?

Consumer

Cooperation in Europe, North America, and Japan, 1840-1990.

Lanham: Rowman & Littlefield, 1999. 377 pp. Notes, bibliography, and index.

$63.00 (cloth), ISBN 0-8476-8648-5; $23.95 (paper), ISBN 0-8476-8649-3.

Reviewed for H-Business and EH.NET by Gerd-Rainer Horn, Department of History,

Western Oregon University.

The Persistence of Historical Alternatives

In this day and age of “the end of history,” a study of consumer cooperation in

the 19th and 20th centuries is a highly welcome occasion to reflect upon

alternatives to seemingly dominant paradigms. The past and present of the

cooperative experience challenged and continues to challenge a whole host of

preconceived notions such as market fetishism in society at large, the

state-centered orientation of much of historical and contemporary socialist

thought and practice, or tendencies to identify cooperatives with the urban

working class Left. If the editors of this volume had done nothing else but to

question these assumed certainties,

t hey would have reached or surpassed this reader’s expectations. In many ways,

they accomplished much more.

Leaving apart a tantalizing reference by Ruth Grubel on the presence in Japan

of “mutual assistance groups” (p. 306) as early as the 17th century, the

cooperative movement generally emerged parallel to the rise of industrial

society. The founders of 19th century cooperatives without exception attempted

thereby to respond to at least some major social ills of laissez-faire

capitalism. Bourgeois liberals were as much involved as the much-maligned

“utopian socialists.” Interestingly, Marxist-influenced social democrats

initially frequently abstained from the construction of a cooperative

commonwealth as many of them (though not all) regarded such ventures as

facilitating an eventual accommodation to actually existing capitalism. If

urban problems as a rule gave birth to the theory and practice of consumer

cooperation, in several important national cases the rural population became

the most forceful and

numerous propagators of the cooperative cause. Any ever-so-brief glance at the

checkered history of consumer cooperation thus raises at least as many

questions as it answers.

Writing these lines near the city of Wuppertal, where one of Germany’s largest

consumer cooperatives in the interwar period built and owned a vast array of

distribution and production facilities, buildings that still stand but in the

post-World War II era housed a succession of private enterprises, the image of

consumer cooperation

as a mere symbol of a bygone age suggests itself with remarkable ease. Surely,

the specific death knell of German cooperatives, expropriation by the Nazi

state, played little role outside of Germany proper. Belgian cooperatives, for

instance, continued to

operate even during the Nazi occupation and, though they suffered, they

apparently suffered from the general economic malaise of German occupation,

not from specific anti-cooperative measures. But the era of consumer

cooperation is now long past its prime.

Or so it seems, until the reader begins to realize that, in Denmark for

instance, the story is an entirely different one. “In the mid-1990s, the Danish

consumer cooperatives represented a market share of roughly 33 percent of the

national foodstuffs and beverage consumption. In every town,

suburb, and rural community, one could find a cooperative supermarket or

smaller shop. In many rural areas, the only retail shop at all was a

cooperative” (p. 221). Canadian cooperatives likewise saw their highpoint

in the most recent decades. “During the 1960s, it seemed on the verge of

becoming a major force in the Canadian economy,” and only “significant economic

swings in the 1970s undercut the capacity of the movement to realize its

earlier promise” (p. 331). Last but not least, today “consumer co-ops

represent 20 percent of the households in Japan” (p. 303). Such simple facts,

ever present realities for consumers in those states but little-known to the

outside world, should immediately question many preconceived notions about

consumer cooperatives.

In their joint contribution at the beginning

of the book, the two editors

attempt to synthesize the points of view of the various contributors: “It is

the argument of most of the authors in this volume that the real

challenge for consumer cooperation in the industrialized world has not been the

movement’s economic weaknesses but its obligation to confront the consumerist

revolution. Cooperation’s great crisis was adaptation to changing times and

tastes – providing a fuller range of goods and appealing to more tastes

without giving up the advantages of low costs and democratic,

consumer participation” (p. 33). In other words, as consumption became ever

more central to the lives of First World citizens, consumer cooperatives began

to trail, or, in the words of Furlough and Strikwerda: “The fundamental shift

in thinking from the nineteenth to twentieth centuries,

which caught consumer cooperation in midstream, was the move from production to

consumption” (pp. 33-34). Were things really that “simple”?

A mere quantitative analysis of the rise and fall of First World consumer

cooperation undoubtedly confirms this trend. In most continental European

countries (and not only here) the highpoint of cooperation by all means pre

dates World War II. But the sheer weight of statistics may be a necessary but

certainly not a sufficient element towards an explanation for this trend.

Indeed, on one level it defies even elementary logic that, of all things,

consumer cooperatives should begin to decline precisely at the moment

when consumerism begins to grow in societal importance and increasingly

determines everyday life. Perhaps a closer look at the success stories of

consumer cooperation since the breakthrough of consumerism in the

Golden Twenties may furnish elements of a more convincing explanation for the

postulated (and, of course, to some extent very real) secular decline of

consumer cooperation.

Carl Strikwerda, in his assessment of Belgian cooperatives ably disassembles

several prominent myths pertaining to the supposed lack of business acumen as

a key cause for the decline of cooperation. Belgian cooperators, he asserts,

early on successfully applied economies of scale and utilized innovative

financing schemes, measures equal to the most flexible tactics of

contemporaneous private entrepreneurs. There is thus no reason, I contend, why

similar creative responses could not have successfully taken up the challenge

of modern consumerism, once it arose.

In the heartland of the modern welfare state, Sweden, the cooperative movement

apparently for a while adapted exceedingly well to the demands of a consumer

society and, significantly without caving in to the demands of rampant

capitalist consumerism, the Swedish movement oriented its members and

sympathizers towards the choice and acquisition of “high-quality,

tasteful products without wasting resources” (p. 257). By 1939, its newspaper

“had become Sweden’s most widely read weekly, printing 570.000 copies every

week” (p. 251),

no mean task in a country of at that time no more than six million people. And

in Japan today the cooperative movement has spawned a series of peripheral

leisure activities, such as sports programs and youth activities, that prove to

be rather popular.

Interestingly, French cooperators in the 1920s executed a similar turn and

“founded vacation colonies, organized excursions, and added movie ‘palaces’

to cooperatives.” “Cooperative stores expanded their inventories to include

items such as furniture and bicycles, and movement literature stressed

‘elegance’ in fashion and ‘tastefulness’ in home decoration” (pp. 185-186).

Curiously, however, what is elsewhere in the volume regarded as proof of

potentially successful adaptation to the challenge of consumer society,

Ellen Furlough here, in combination with some other trends, criticizes as an

abandonment of lofty goals. “The reorientation of consumer cooperation after

World War I signaled the decline of a collective perspective within the

movement. It also eroded the possibility of a collective ideology, of

socialized structures, and of a culture of consumption that was socially

engaged within twentieth century French commerce and distribution” (p.

186).

Only a more detailed examination of the French case may

tell whether French cooperators in the Golden Twenties really did abandon a

“collective perspective” and “collective ideology.” As Furlough’s

above-mentioned contribution stands, however, this reader is tempted to locate

the author’s hostility to the changes of interwar cooperators primarily in the

latter’s creative engagement with consumer culture and its refusal simply to

ignore the reality of a changing world, where an increasing range of goods to

buy and things to do may constitute a growing source of collective and

individual pleasure. As the success stories of Denmark, Sweden and Japan

suggest, if coops have a chance, it lies precisely in abandoning an attitude of

splendid isolation and in taking up the challenge and adapting to the modern

world.

Several authors (and both editors) stress the role of gender in the cooperative

movement and point out that, whereas women constituted the vast majority of

consumers in the various cooperatives, the top decision makers for the movement

were, with few exceptions, men. Furlough and Strikwerda indirectly suggest

that this gender bias hampered cooperators’ success:

“While cooperation differed in important ways from capitalist consumerism,

notably in its commitment to social control over consumption, an analysis of

the ways that gender informed the cooperative movement calls into question the

cooperative movement’s claim to be an active counterexample to capitalist

society” (p. 52). But pointing out the limitations of cooperation as feminist

alternative to the

capitalist norm is not the same as explaining its tendential decline. For,

capitalist retailing businesses were no more oriented towards including women

as active decision makers,

but they obviously won many a competitive battle with cooperatives.

If the level of business skill proper to cooperatives cannot explain the

coops’ secular decline; if coops were indeed able to integrate the challenge of

consumerism into their project, as witnessed in Sweden,

Denmark, Japan and perhaps France in the 1920s; if

gender politics may explain why coops may not have constituted full-scale

societal alternatives but not why coops failed – then what does account for the

fact that, within the First World, coops are less prominent and visible today

than seventy years ago?

Here, Carl Strikwerda’s observations on the Belgian case may point in the right

direction. After justifiedly stressing the difficulty to separate the

“ideological and the business sides” of cooperation, he goes on to make the

following capstone statement: “When the movement as a whole had a vital

mission, before World War I, it managed to pioneer more in business methods and

at the same time to adapt to the needs of consumers. When the movement lost its

forward motion in the interest-group politics of the 1930s, cooperation, too,

failed to innovate” (p. 86). In other word, when cooperators were able to

develop a forward-looking dynamism, innovations followed suite. When

stagnation began to set in, a growing lethargy affected all aspects of

cooperative life.

Given the fact that, on the eve of the new millennium, the First World remains

home to several thriving cooperative experiences, one is left to conclude that

explanations of cooperative failure pointing to secular societal trends are

fatally flawed.

Rather than searching for general causes, it thus appears that nationally

specific and contingent causes may ultimately be of far more persuasive power

than answers stressing the historically limited viability of the cooperative

experience as such.

In their opening contribution, the editors stress that “we believe that

capitalist and cooperative commerce represent different models of consumer

culture, models that for a time exercised different appeals” (p. 5). This

reader therefore concurs with Furlough

and Strikwerda who contend that a

“particular [capitalist] consumerist ethos was, as the study of consumer

cooperation will demonstrate, neither inevitable nor universally embraced,

and there have been (and continue to be) competing visions and practices.

The form of capitalist consumerism that has immense power and influence today

is a peculiar historical development, not a linear and inevitable

‘end of history'” (p. 2).

As can be expected in any collection of articles, the relative merits of the

contributions vary, as do the authors’ particular approaches to their subject

matter. Repetitions and lengthy empirical narratives abound; but all these

potential drawbacks cannot diminish the importance of this collective

anthology. It constitutes an insightful and stimulating first step towards the

explanation of the infrastructure of consumption in the age of capitalism. And

it simultaneously suggests that there is no inherent logic why retailing

businesses are structured as they tend to be today. It is the

great merit of Ellen Furlough and Carl Strikwerda to have drawn attention to

the possibility of historical alternatives in an area as seemingly “naturally”

capitalist as commercial activities in 19th and 20th century First World

societies.

Published by H-Business and EH.Net (August 199 9)

Ellen Condliffe Lagemann, editor. Philanthropic Foundations: New

Scholarship, New Possibilities. Bloomington: Indiana University Press,

1999. xviii + 420 pp. Bibliography, index. $35.00 (cloth). ISBN 0-253-33500-0.

Reviewed by Milton Goldin, Nation al Coalition of Independent Scholars

(NCIS).

“…why can’t we be a nice foundation like Rockefeller?”

– Henry Ford II on the Ford Foundation [1]

In her introduction to the seventeen essays in this book, Ellen Condliffe

Lagemann writes, “. . . foundations themselves have discouraged scholarly

writing. Having been the subject of hostile Congressional investigations on at

least four occasions, they have been extremely skittish about opening their

files to outside scholars,” p.

ix. Which is true, but not the only reason why 42,000-plus foundations in

America that currently have assets of some $326 billion are frequently less

than forthcoming sharing information. Other reasons include Internal Revenue

Service agents seeking evidence of

donor malfeasance, donors searching for information whether other donors gained

some special IRS advantage, program officers at foundations attempting to learn

how policies developed elsewhere, and nonprofits canvassing for grant

information not published

in annual reports.

While considering the complexities of this situation, the relatively unbiased

observer will be struck at once by the pervasive reluctance in every camp to

admit that other camps might have some right on their side. Yet, beginning with

John D. Rockefeller’s failure to receive a Congressional charter for the

Rockefeller foundation (about which,

surprisingly, nothing is said in this book, although it was the opening

engagement in hostilities between Congress and foundations), solid cases

for various positions have been made by such eloquent spokespersons as Wright

Patman, McGeorge Bundy, Julius Rosenwald, and John D.

Rockefeller, Jr. And, despite harsh comments in some of the essays, it should

be emphasized that not all foundation critics in Congress have uncontrollable

desires to ferret out information on leftist donors or conservative donors,

depending on the particular member’s political affiliation.

The scholars writing in this volume concentrate mainly on how and why social

problems and foundation programs have affected each other, not on how

foundations relate to political developments. There are no discussions, for

example, on how it was that the Ford Foundation became a conduit for CIA

financing of student groups in Central Europe during the Cold War, in the four

essays that deal with the Ford Foundation:

Alice O’Connor’s, “The Ford Foundation and Philanthropic Activism in the

1960s”; Gregory K. Raynor’s, “The Ford Foundation’s War on Poverty:

Private Philanthropy and Race Relations in New York City, 1948-1968″;

Rosa Proietto’s “The Ford Foundation and Women’s Studies in American Higher

Education: Seeds of Change”; and Richard Magat’s, “In Search of the Ford

Foundation.”

The Ford Foundation, which receives almost a quarter of the book’s pages, is

especially important in the overall picture because from its creation in 1936

until August 1999, when the Bill and Melinda Gates Foundation exceeded it in

assets, it reigned as the wealthiest foundation in history. Immediately that

the

Ford Foundation was created,

however, a chronic problem emerged whose existence partially eluded even that

sharp-eyed analyst Dwight Macdonald, who would describe the entity as a “large

body of money completely surrounded by people who want some.”[2]

After Henry Ford’s son Edsel died, the youthful grandson Henry Ford II moved

quickly to prevent the family’s losing control of the Ford Motor Company.

Financed with Ford non-voting stock (a development Congress happened to

notice), the foundation had no definite purpose in Henry II’s mind other than

fiscal salvation for himself and his relatives.

Meanwhile, seeking a primary focus, the foundation would swing from education

to the social sciences to international affairs to the arts to social action,

and its

trustees would sell off the non-voting stock.

This turned out to affect Henry II’s power as chairman of the board; by the

mid-1970s, although the conservative Henry II remained chairman, the liberal

McGeorge Bundy was firmly entrenched as president, and

John J.

McCloy, a long-time ally of the liberal Republican Rockefeller family,

effectively managed its board. In 1976, Henry II resigned.

Little of this story is told in the book. Explaining why the Ford Foundation

has never published a formal history, Magat quotes Susan Berresford, the

current president, who offers up the view that

“foundations are not of great interest in the public eye.” She adds,

“Their work is understood through the work of their grantees,” (p. 312).

Barry Dean Karl disputes that view in his well-reasoned, “Going for Broke.”

Karl argues that what finally stimulated philanthropic studies centers on

university campuses was not a pressing need for new understandings of

foundations, but the Filer Commission, a Rockefeller-sponsored project that

was itself a consequence of the Tax Reform Act of 1969 and populist Wright

Patman’s mid-1960s attack on foundations. Karl writes that “historians were

replaced by economists in an effort to show that private investment in public

policy was more efficient, more effective, and certainly less expensive than

public investment,” p. 289. Furthermore, the conventional wisdom was wrong that

there was “enough resemblance among institutions called foundations to make

generalizations possible. Those generalizations will be helpful for

understanding how foundations work, but only to the extent that these

[sic] general notions bear a close relation to the real world in which

foundations operate,” p. 290.

Later we learn from William S. McKersie (“Local Philanthropy Matters:

Pressing issues for Research and Practice”) that as “governance devolution and

fiscal austerity” become dominant public policy trends,

localities may be unable to turn either to Washington or to national

foundations for help. They will have to look to their own resources to finance

welfare and other programs. In essence, today’s “real world”

dismantling of the welfare state could (at least, in theory) return the nation

to a time when communities had to care for their own poor, as they did

before the Great Depression and the New Deal.

Problems inherent in a massive shift of this type could be formidable.

McKersie tells us that aside from financial and manpower limitations,

many local foundations do not have the resources to collect or manage data

and/or to use data from national foundations to analyze local situations. Which

is why he makes the reasonable point that “local philanthropy matters must

become the focus of more rigorous research and commentary,” p. 330. He cites as

an example of the ideal Chicago’s Joyce Foundation, one of the 100 largest in

the United States, which operates off its endowment with no need to raise

funds, has no ties to deceased benefactors other than through the family’s

former law firm, and is a godsend to the

community.

The final essay, Lucy Bernholz’s “The Future of Foundation History,”

includes the encouraging promise that although historians are trained to look

backward, she will use both her training as an historian and her experience as

a program officer at a community foundation to look forward. She reports, “One

foundation executive recently said to me, ‘The scholars who write about

foundations don’t have a clue about what we do.’ My sense is that this

statement is true in reverse as well, and that bo th

sides contribute to the misunderstandings,” p. 359.

This is an understatement, given the essays in this useful book.

[1] This quotation has appeared in other versions. I discovered this one in a

newspaper clipping, with no attribution, in the Ford Foundation Archives, Ford

Motor Company, Series II, Box 15, Folder 186, “Complaints about Ford Foundation

Activities.”

[2] Dwight Macdonald, The Ford Foundation: The Men and the Millions

(New York: Reynal, 1956), p. 3.

Published by EH.N ET (July 1999)

Roy Church and Quentin Outram, Strikes and Solidarity: Coalfield Conflict in

Britain, 1889-1966. Cambridge: Cambridge University Press, 1998. xx +

314 pp. $69.95 (hardback), ISBN: 0-521-55460-8

Reviewed for EH.NET by Judith Wale, Warwick Business School, University of

Warwick, UK.

The British economy was dependent in the extreme on its coal industry as a

source of fuel for all but the final decade of the period covered by this book.

Exports, moreover,

comprised a significant proportion of output throughout the earlier part of

the period and especially before 1913. The numbers employed in coalmining rose

from around 620,000 in 1890 to almost 1.1 million in 1913, before peaking at

1.25 million in 1920.

Employment levels had fallen to 780,000 by 1938, a figure never again reached,

but were still over 700,000 in 1957, though they then dropped to around 450,000

by the final year covered by this study, 1966. The size of the industry alone

justifies this new

look at the high strike propensity of the industry by Roy Church (University

of East Anglia, UK) and Quentin Outram

(University of Leeds, UK), who have both previously published extensively on

coal. An important benefit of the long period they examine is

their coverage of both the pre-1947 era of private ownership of coal

production,

when the industry was fragmented operationally among several hundred

independent enterprises, and the post-1947 era of nationalization of production

under a single National

Coal Board. The book encompasses a wide-ranging survey of existing literature

not only on coal but also on strikes and industrial conflict more generally, as

evidenced by the extensive bibliography. In building on earlier work and

developing new approaches, Church and Outram are purposefully

interdisciplinary, not only combining quantitative and qualitative methods as

historians, but also bringing together theoretical concepts in industrial

relations and actual practices as handled by labor historians. One innovation

of the book is its concentration on strikes at the local level, mostly at the

level of the colliery, in contrast to earlier tendencies to focus on nationwide

or at least coalfield-wide strike activity. In consequence, though the long

national strikes of 1912 and 1926 receive appropriate attention, it is not the

well-studied causes of these strikes but the hitherto little-understood factors

behind the large numbers of local strikes which form the main subject of this

book. Data on the number

of strikes were collected annually by the government from 1889; these provide a

firm foundation for the study of strike patterns and causation. The key

question which Church and Outram seek to answer is why some collieries or

localities were so markedly more strike-prone than others and why, in an

industry notably strike-prone by UK standards, some localities were virtually

strike-free. In attempting to provide answers, the strikes are examined not

only as conflicts between workers and employers, but also

as instances of co-operation among workers.

This co-operation is the “solidarity” of the book’s title.

After setting out their objectives and methodology in the first chapter,

Church and Outram spend three chapters setting the context of the strikes,

providing an incisive and fresh analysis of the organization of the coal

industry, as well as of relations between employers and employed together with

their respective attitudes and outlook. There is much here to interest the

historian of business and management, since the functions and attributes of

the “coalowners” – the owners and senior managers of the colliery operating

companies down to 1947 – are examined in depth. Chapters 5 to 9 form the core

of the book. Analysis of strike activity leads to the perhaps surprising

conclusion, given the reputation of British miners for militancy, that local

strike action frequently recruited few followers; in other words, solidarity

was often limited. The precise nature of solidarity in this context is then

investigated. Turning to the causes of the enormous variation in strike

activity, Church and Outram test the frequently stated hypothesis that high

strike activity arises from the crowding together of miners in isolated

communities (in which many, though by no means all, of them lived). The

results partly substantiate this hypothesis, but also suggest that the massing

of miners in their workplace — underground or on the surface at larger mines

— as well as in the wider community was an important factor in increased

strike propensity. Interpretation of the size effect of mines is however

difficult, since it is not clear whether the relevant factor is the overall

size of the workforce or the larger number of separate work groups which a

larger mine will contain.

There is some evidence that solidarity arose within groups of miners working

together,

such as teams extracting coal on an advancing longwall face. At the end of

chapter 9 Church and Outram find that they have partially explained variations

in strike propensity, but that they must also seek causes other than the

structural ones so far examined. Accordingly in chapter 10 they investigate

statistically the types of local organization and policies of both management

and trade unions for their impact on the

level of strike activity. Certain characteristics on both sides which tended

towards higher levels are identified, but the mechanisms which linked the

characteristics to actual strike outbreaks remain somewhat obscure. Still

unexplained is the fact that collieries apparently alike in structural and

organizational respects could vary markedly in strike activity. Chapter 11,

which attempts to explain this fact, is however the one weak section of the

book. It compares for the interwar period nine pairs of neighboring

collieries

(representing seven major coalfields) which have been matched for similar

structures. Within each pair one colliery was notably strike-prone and the

other notably strike-free. The problem is that, while Church and Outram admit

to a shortage of information on some pairs, they nevertheless draw conclusions

on the attitudes of managers and miners which are not justified, given the lack

of essential details or lack of a coherent story of events over time. (This is

not to say that their conclusions are necessarily wrong.) Though the evidence

for many collieries is fragmented,

further archival research on company records should reveal data which would

allow additional and more accurate pairing of collieries and hence better

substantiated conclusions.

The issue of continuity and change before and after nationalization in 1947 is

raised in chapter 12. Change of ownership seems to have had remarkably little

effect on labor relations, with the high level of local strikes which began in

the late 1930s persisting through to the mid-1960s. The forces of continuity

at the colliery level appear to have been strong. The same combination of

structural and organizational factors with the occurrence of particular events

is needed both before and after nationalization to explain variations in

strike propensity. Chapter 13 makes a valiant attempt to draw comparisons with

coalmining strikes in France, Germany and the United States. The attempt is

however, as Church and Outram admit, largely defeated by

the inadequacy of the statistical base, though they tentatively conclude that

the British experience was exceptional. In the final chapter, entitled “Myths

and Realities,” they emphasize that some of the conclusions they have reached

challenge received views regarding coalmining strikes and so-called militancy

of miners. This book, despite one significant drawback, should be read with

benefit by a wide range of economic, social and cultural historians.

Judith Wale’s current project, funded by the Nuffield Foundation, is entitled:

“Management Strategies and Business Performance in the British Coal Industry,

1914-1946.”

Published by EH.NET (August 1999)

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Thomas Cate, Editor, G.C. Harcourt and David C. Colander, Associate Editors. An Encyclopedia of Keynesian Economics. Cheltenham, UK and Brookfield, MA: Edward Elgar, 1997. xxiv + 638 pp. $235, ISBN: 185898145X.

Reviewed for EH.NET by Michael S. Lawlor, Department of Economics, Wake Forest University.

Macroeconomics today is in a peculiar state. Internally, the profession seems to have lost interest. Macroeconomics is neglected as a research topic. Outside of handy data to which to apply the latest advances in time-series econometric technique, graduate students seem to frown upon it as a dissertation topic (judging from the informal sample of assistant professor candidates we have interviewed in the last ten years). No longer are the heady debates, claims and counter-claims of the theoretical battles of the 1970s and 1980s making headlines in the journals.

Yet simultaneously, externally, out in the real economy, something of a revolution (to use a phrase popular in macro-talk) does seems to be taking place in macroeconomic performance, and possibly also in policy. T his is especially so in the case of the United States economy. U.S. real output growth has exceeded all consensus forecasts for the last 3 years (final figures for 1997 and 1998 came in at 3.8% and 4.2%). The duration of the expansion of the economy has now pushed into record territory. Unemployment has been falling for years and has now stood below 5% since 1996. And, most macroeconomically amazing of all, these good times have been accompanied by falling rates of inflation (below 3% for all but two quarters since 1995, below 2% since 1997:4). On the policy side, meanwhile, there is a degree of unreality. Fiscal policy, long ignored in the shadow of deficit politics, has seemingly dropped from the U.S. policy debate (although not so in Japan). Monetary policy in the era of Greenspan is widely given credit for engineering the U.S. miracle. But if you look a bit closer, both Greenspan and his cheering section seem a bit puzzled, even nervous about all the good fortune. M2 growth has fluctuated widely in the nineties, with little apparent correlation with inflation. Moreover, as inflation has declined, M2 growth has been consistently above the upper bound of its target range for most of the period since 1995. Consequently, both publicly and privately the Fed has abandoned money as an intermediate target, preferring to concentrate on the federal funds rate. Federal Open Market Committee (FOMC) minutes reveal a confusing search for signs of inflation that “must be there,” given the state of unemployment, along with much vague discussion of the financial press’s view that we are now in a “New Economy.” The essence of the novelty and the puzzlement seems to be a search for an unexplained and unmeasured productivity boost. Finally, there is the intriguing macroeconomic record of the rest of the world to add spice to this seemingly fertile ground for macro researchers. The largest experiment in one-shot monetary reform since Bretton Woods is taking place in Europe, while all of its major member states, except the dissenting U.K. (see IMF, 1999 for complete details), are still suffering from years of persistently high unemployment. The Asian Tigers have come down with a case of financial flu-if not pneumonia. Japan, the shining light of the 80s, has been limping through a very depressed decade, with disastrous GDP growth, and an interminable financial mess. As Japanese short-term interest rates have hovered below 1% for over four years now, we are perhaps catching the first real glimpse of a that old Keynesian curiosa, the liquidity trap. These are interesting times indeed.

What does modern macroeconomics have to tell us about all this? Has the profession’s enlightenment by the New Classical school helped us in understanding this state of affairs? More to the point of the book here under review, can we now profitably reassess the recent decades of macroecomic debate and experience with a less ideologically heated, more balanced and sober historical view? These are the issues that reading the current volume bring to mind, especially when considering a review for a list that has recently staged a fascinating forum calling for research on “economic history since 1950.”

Let me postpone some short remarks on these questions, though, to turn to the volume I was given to read. An Encyclopedia of Keynesian Economics contains 169 entries by 144 contributors and runs to 638 pages, with no index. The entries are of three varieties: brief biographies of various economists associated with “Keynesianism,” very broadly conceived (Silvio Gessel, Arthur Okun and Robert Lucas are profiled, for example); brief sketches of theoretical issues, models and tools arising in macroeconomic debates (e.g., “Okun’s Law” and “The Lucas Critique”); and longer pieces which typically deal much more closely with issues in Keynes scholarship (e.g., “The Influence of Burke and More on Keynes”).

The quality of the entries is varied. Some of the entries are entirely pedestrian, perhaps intentionally so to fit the evidently strictly imposed spac e requirements for the shorter biographies and theoretical topics. Theoretical topics suffer the most from this enforced brevity. Overall, I find the average level of the discussion in this volume inferior to some other recent reference works of its kind. The New Palgrave: A Dictionary of Economics (Eatwell, Milgate and Newman,1987), more deeply covers many of the same topics, albeit mixed in with much else. On the general topic of macroeconomics, the recent Business Cycles and Depressions: An Encyclopedia (Glasner, 1997) provides more complete coverage, especially of empirical issues in macroeconomics. Closer still to Keynesian concerns, but a beast of a different kind, is “A Second Edition” of the General Theory (Harcourt and Riach, 1997), which includes much more extensive treatments of issues arising within and from Keynes’s landmark book. At a minimum I would recommend cross-references to these sources be consulted along with the entries in the present volume. In any case such short entries as are here provided for theoretical issues can only serve as a mere starting point for further reading, and in this volume the excellent bibliographies attached to many entries will be as valuable a tool in that search as the articles themselves.

Some entries are not well done-“The Monetarist School of Economics” is bizarrely written, for example. It appears to have been inelegantly ripped from the preface of the author’s book on the subject, making references to that text that are unintelligible to the readers of the encyclopedia. But others are remarkable, mostly in those instances where more freedom of space was allowed. My favorite, was “Marshall and Keynes” by Peter Groenewegen, a fascinating and admirable condensation of the extensive treatment Groenewegen gave to this topic in his recent biography of Marshall (Groenewegen, 1995). It shows clearly the continuing impact of Marshall and Marshallian habits of thought on Keynes’s work up to and including his framing of the General Theory. Other entries raise expectations that are ultimately disappointed. In the treatment of Lucas and the “New Classical School of Economics,” for instance, there is a lamentable failure to confront the challenge that the last decades’ theoretical debates have posed for Keynesian economics. The reader longs to see a position taken on who has been left standing after the dust settles. Instead, we get sterile recounting of the dry points of various famous articles (evidently no “books” are influential in this field anymore) with no attempt at evaluation. (For a sterling discussion of this very topic, one that goes far to redeem Keynesianism, while recognizing the contributions of Lucas, see Peter Howitt’s “Expectations and Uncertainty in Contemporary Keynesian Models” in Harcourt and Riach, 1997). I suspect that the editors wanted to limit the partisanship of the volume and thus let each camp speak for itself. No conflict seems evident in this account and thus no evaluation of what we have learned from the tumultuous debates of the last twenty years emerges. Similar complaints apply to the entries on “Money,” “Neutrality of Money: The Keynesian Challenge,” “Monetary Policy,” and “Business Cycles.”

Partly this unsatisfactory nature of the debate reflects the problem of what purpose such a volume is intended to fulfill. This encyclopedia seems to be at cross-purposes with itself. It wants to reach out for inclusiveness-arguably all macroeconomics can be considered in some sense derivative from Keynes. Yet it must be taking sides to some extent in light of its very title. There has obviously been an explosion of scholarship on Keynes, Keynesianism, Post-Keynesianism and things Keynes-like (e.g., the philosophical issues surrounding expectation formation) in recent years. Much of this work was spurred by the combination of dissatisfaction with macro theory in the seventies and the publication of Keynes’ Collected Works. Thus there is now a whole (often interesting) sub-culture of the sub-culture that is the History of Economics devoted to Keynes studies. Another aspect of the same period of resurgence of interest in Keynes has been the extreme partisanship of macroecnonomic debates. It came to be something of a political and methodological ‘statement’ to be identified as a Keynesian in the eighties. While none of the issues raised in this period were ever settled-indeed I would say that much of Keynesianism has aged the period considerably better that any one would have predicted in the midst of the New Classical heyday-the debate itself seems now to have disappeared (except to be drearily recounted in the, significantly last, chapters of most otherwise Keynesian intermediate macro texts). Talking to most recent Ph.D. graduates reveals a pervasive ignorance and disdain for the whole topic of macroeconomics. Thus at whom is the present volume aimed? Is it designed to convert the heathen or to preach to the choir? Consideration of this issue will bring us back to the peculiar state of modern macro theory mentioned above. To motivate that consideration I would like to direct attention to the general history of encyclopedias, looking for clues to the role they have played in past eras of scholarship.

Encyclopedias as a bibliographic form can be traced back more than 2000 years (see the Encyclopedia Britannica entry for a useful account). The beginnings in Greek and Roman times play upon the first meaning of the word-a circle-to imply a complete system of learning or an all around education. There is a long and fascinating history of the concept since Plato’s nephew Speusippus (died 339 BC) began to convey his uncle’s ideas by recording the spoken word of the Forum. Some issues that arose over the course of this long development are interesting to consider in relation to our current theme. The question of audience has always been paramount. For most of their history encyclopedias were written to be a source of sound moral instruction. Hence the fashion of including biographies of exemplars from the past. The reader, it was hoped, would be elevated, inspired and refined by contact with the minds and lives of ideal man. Prior to the Enlightenment, encyclopedias were usually intended for very select groups that the author or editors could easily visualize and about whom they could therefore make certain assumptions. Early on, one could assume that he could read Latin (or “she” could-one of the most beautiful mediaeval encyclopedias is an illustrated manuscript of 636 pages by the abbess Herrad (died 1195), for use by the nuns in her charge). Other safe assumptions included that he or she was of high status and young and so in need of instruction, or later that he or she was a believing Christian, probably a Catholic cleric. In these didactic encyclopedias the common presumptions of the background of the reader were the source of the notion that encyclopedias should dispense with excessive moralizing and commentary in trade for brevity and clarity. Thus many early encyclopedias were little more than compendiums of selected pass ages of great writers, chosen to impart information that would be useful in the readers’ work and private life.

Another closely associated concern of encyclopedias in the pre-Modern period was the issue of the division of knowledge into the Sacred and Profane, or the Spiritual and the Secular. Increasingly, as scholarship became more developed and use was found for non-Christian ancient texts in describing the world, the Scholastic encyclopedists found themselves torn between acceptable beliefs and a passion for objective reporting of scientific observations. This division of course reached its height in the Enlightenment period. In the hands of Bacon, and especially Denis Diderot, the implicit and explicit purpose was to herald a new secular order where all thought would be encompassed in a philosophical system based on logic and natural law – the Enlightenment project. Diderot’s famous Encyclopedie (1751-65) enlisted, perhaps for the first time, a gigantic assemblage of high quality writers, commissioned to survey only secular knowledge. Scandalous in its day as a challenge to orthodox authority, this concept, as much as its uneven execution, has been accorded a substantial role in conditioning the revolutionary spirit of France in those crucial last decades of the Ancien Regime (Darnton, 1979).

If this can only seem incredible to us today-a revolutionary encyclopedia! – it is not only due to the irrelevance of the Academy in our post-Modern age. More directly it is due to the British reaction to the French Encyclopedia. The Britannica consciously avoided the lengthy and scandalous polemics of Diderot’s work, and instead soberly set out to achieve with an extensive list of short, factual entries, the aim of complete scientific and scholarly coverage. To this day we associate this task with the very meaning of encyclopedic. In the vernacular, completeness is the essence of what might be called the popular view of encyclopedias as the ready source for the answer to all queries. (In this regard it is useful to recall that in the 18th and 19th centuries most encyclopedias were sold ahead of time by mass subscription, the funds from which went to pay the writers. Since then the notion of a mass audience, not a select few, has characterized most modern encyclopedias.) This all-encompassing authority of encyclopedias is a view that has no doubt been much damaged at the hands of encyclopedia salesmanship, but still “sells” to the general public via parental faith in educational salvation for their children and schoolroom searches for last minute research papers. Truth be told the attraction reaches much higher in the hierarchy of the knowledge industry than that. What scholar can deny the still live attraction of the promise of knowing the essentials of all there is to know? Thus we can easily connect with the marketing savvy that inspired Dominco Bandini to market his fifteenth-century encyclopedia as Fons Memorabilium Universi (“The Source of the Noteworthy Facts of the Universe”).

Considering this complex set of issues from the general history of encyclopedias along with modern economics is an interesting exercise. Let us begin with the question of audience. An outside audience for economics in its true rhetorical dress of peculiar notation and specialized jargon is now an impossibility. Most of economic “research,” like most of science in general, has now progressed into corners that only the sub-discipline specialists themselves care to venture. Consequently the notion of an all-encompassing dictionary of economics, let alone of all knowledge as in encyclopedias of old, now is beyond belief. Today, the primary purpose of a scientific encyclopedia is to explain to the profession as a whole what the specialists in any area are doing. Here is one dimension in which economics truly can compare to modern science. The New Palgrave definitely fits this bill, as anyone who has ever sent an undergraduate over to the library to consult it has found. If ever there was one of those much discussed businessmen for whom Marshall was writing at the turn of the century, they are definitively not the targets of economic encyclopedias, the Encyclopedia of Keynesian Economics included.

Who among us economists then would profit from the volume? It is safe to say that anyone could profit from some aspect of the volume. At the most universal level some biographies are very interesting and even instructive (some are horribly dull). My favorite was the account by Robert Leeson of the New Zealander A.W.H. Phillips, of the much abused Phillips Curve (an association he was evidently loath to acknowledge). He was a kind of Henry-George-like figure in his colorful background and circuitous route to economics by way of earning his living as a fiddler, crocodile hunter, R AF officer, Japanese prisoner of war and engineer. He seems also to have been an exemplar of the gentleman scientist in the best possible sense of the phrase-disdaining both his own personal acclaim and the, as he saw it, distasteful acrimony of the macro policy debates inspired by his famous paper. But even less colorful biographies offer interesting tidbits-for instance that R. E. Lucas’s parents were New Deal Democrats, that he earned his BA in history and that he prefers to be called a “Monetarist” rather than a “New Classicalist.” Of course the fascination of Keynes’s biography needs no elaboration. Beyond the personal stories, unfortunately, it seems very doubtful to me in our ever more unconsciously conservative profession that many besides the already initiated will find a dictionary on “Keynesian” economics worth the look.

Which brings me to the issue of fact versus faith, or what the medieval monks who compiled encyclopedias termed, “the sacred and the profane.” If encyclopedias are to instruct the young and uninitiated they must have some imprimatur of authority akin to the ecclesiastical seal that the scholastics put upon medieval texts and the similarly ceremonial listing of the legion of famous authorities, resplendent in their degrees and positions, which all modern mass-market encyclopedias display prominently at the head of the first volume. Amongst the brothers and sisters of the macro faith today, though, the priesthood is in serious disarray. There is little enough agreement on basic principles for a consensus among specialists, let alone among the profession as a whole. Just who are the true priests and who are the worshipers of false idols varies by sect. It is this state of uncertainty and discord, I believe, that has effected the graduate training of new economists and turned them away from macroeconomics at just a point in time when the topic seems so interesting. If one has to spend hours learning the latest refinements of New Classical, Real Business Cycle, New Keynesian and Cash-in-Advance macro models to get through the macro sequence, there is little time left to synthesize what one really knows about macroeconomic theory, much less macroeconomic events that will not be covered on the preliminary exam. More telling perhaps is the partisanship, for no vibrant research program is ever just a catalogue of received truths, but must generate ever-new questions and puzzles to progress. If there is little tolerance shown for alternative viewpoints by the lights of the profession, then graduate students are not to be blamed for their reluctance to try to sort it all out for themselves.

Moreover, if the student does happen to have a prior interest in macro events or, more likely, finds himself assigned to teach or write about macro to a non-economist audience (like a group of Principles students) he will quickly find that the only intelligible framework for doing so is the very same old-time Keynesian macro of the pre-Lucas era that was supposedly destroyed by that JPE paper back in ’75! An archipelago of islands inhabited by rational agents, continuously in equilibrium but frustrated by the signal extraction problem is interesting enough, perhaps-but what does it have to tell us about the crash of the crash of the Indonesian Bahtand its implication for the sustainability of the long boom in the U.S.? Faced with the latter question, one inevitably starts talking about aggregate demand, lender of last resort, etc., in ways that would hardly surprise your average 1970s-era macro theorist.

Or, alternatively, we have this puzzle that Alan Greenspan has now spoken of on numerous occasions of how to determine if the recent (pleasant) inflation surprise was a temporary cyclical artifact of reduced world demand or a new era of increased productivity growth. From the realm of high theory we might well sense a resemblance to both the new endogenous growth literature and the real business cycle model. But what do they have to offer in explanation for the current short-term situation or as a guide to Fed policy making? Next to nothing it would seem, judging from the discussions at the recent FOMC meetings. Yoo (1998) offers a very interesting analysis of the “puzzlement” in the FOMC over what they should do to respond to the current macro situation. His analysis, following their discussion, is framed in terms of such issues as the state of “aggregate supply,” “productivity,” the “investment and consumption components of aggregate demand” and the “capacity constraints on the economy.” Reflecting on the impact of the recent macro theory debates, he notes that the Fed continues to distrust money supply growth as a reliable indicator and finds itself “puzzled” by recent performance. The minutes for the FOMC meeting of May 20, 1997 report that:

The members found it very difficult to account for the surprisingly benign behavior of inflation in an economy that had been operating at a level approximating full employment, indeed, possibly somewhat above sustainable full employment in labor markets in the view of a number of members, especially taking into consideration the recent further decline in the unemployment rate. On the basis of historical patterns, any overshooting of full employment would be expected to generate rising inflation over time. (quoted in Yoo, 1998, p. 35)

In one fashion we might say that the big puzzle for the Fed has been to try to uncover what the non-accelerating inflation rate of unemployment (NAIRU) now is, after having seen virtually every consensus estimate of it for the last 15 years succumb to continuing growth with falling inflation.

My point is that virtually all of this policy discussion is conducted in terms of an aggregate short-run supply and demand framework that most closely resembles textbook Keynesianism of the kind that still dominates the intermediate course market. It bears little evidence of influences from the last 20 years of macro research. And if such an application were to be attempted, what would it suggest? That we continuously measure the elasticity of substitution between labor and leisure and between present and future consumption? That we try to anticipate the next shock to the economy’s production function – which are after all considered completely stochastic in the New Classical/Real Business Cycle literature anyway? At best such models approach reality by a non-unique calibration of a whole set of parameters that allows the model to simulate the record of past business cycles. They seem to have no forecasting ability. Note, that while automatic “rules” are very popular among recent theorists of macro policy, no central bank is actually bold enough to seriously adopt one. Flying completely blind, counting on the economy to right itself, neglecting any attempt at anticipation of events, is not in the repertoires of central bankers today – if it ever was (see John Wood’s forthcoming book (Wood, 2000) for a fascinating argument about the mindset of central bankers versus that of economists).

Yet confidence in the self-correcting automaticity of the macroeconomy is the bedrock of classicism (old and new), considered as a policy framework. Thus to give the classical view its due we should also consider the possibility that we have returned to the long-run stability of some past macroeconomic golden age-the gold-standard era seems to be a favorite. This would be a period when budgets were routinely balanced, governments non-intrusive and money so stable in value that actors on the economic stage did not even consider monetary policy in their calculations. Or, put more theoretically, the explanation might be that macroeconomics is not even at issue and what we are dealing with today is long-run supply considerations that no macro policy could do anything to foster in the first place. It is tempting to reply, “tell that to the Japanese!” More soberly, what evidence can we bring to bear on this proposition?

First I believe it is the economic historians who staged the debate in the last 15 years or so on the question of the relative stability of older (pre-war, pre-Keynesian) business cycles, versus newer (post-war, activist government-era) cycles. The exact outcome of the debate as I read it (Romer, 1986, Lebergott, 1986, Weir 1986, Diebold and Rudebush, 1992) is that the initial, and macroeconomically conventional, claim that the post-war business cycle was more stable (challenged by Romer, defended by the others) still holds up. But whatever the case, no one has suggested that the post-war cycle is less stable than the pre-war one. Outside of price stability (where the Gold-standard era is clearly superior), data scarcity makes macroeconomic comparisons before 1929 difficult. But an argument can certainly be made (given one’s weighting of low unemployment and growth along with price stability) that the 1950-1970 era (1961-1969 is still the longest expansion on record but is normally discounted for the “war” effect when compared with “peacetime” expansions) is the most ‘golden’ of ages from the standpoint of macro performance – particularly if we look at international comparisons. Is returning to a pre-war policy context necessarily a good thing?

But other problems are also evident in a crude classical view from a shorter-term perspective. One, the fiscal policy aspect is not at all clear. Th e long-boom(s) of the last 15 years (the expansions 1982:4 – 1990:3, plus 1991:2 – today) were of course mostly a period of extremely high and growing deficits, though followed by shrinking ones after 1992. Moreover, as the European countries positioned themselves for monetary union, they too shrunk their deficits as a percent of GDP (since about 1994). But they have mostly seen no similar decline in the unemployment rate. Thus the role of fiscal effects is not easy to untangle. An alternative story could be told that the U.S. example is one of fiscal demand stimulus (under the banner of supply-side economics), followed by a cyclically balanced budget as the Clinton tax-plan and output increases pushed up tax revenue. Finally, as to the benefits of the productivity shocks we may be experiencing, they are of course part of the Keynesian view in terms of the effect on aggregate supply. But one does wonder about Japan in this context, which seems to be the source of much of the information management and inventory techniques that are often cited as the source of the “New Economy,” but which can’t pull itself out of a very deep recession. (It has been interesting to watch the US administration, the policy institutes and even the Wall Street Journal, admonish the Japanese for not pushing a more aggressive fiscal stimulus package. Evidently the rhetoric of balanced budgets stops at our shores.)

Lastly there is the hand wringing over the financial and monetary situation. We have seen the Fed successfully intervene to ward of the contagion of financial crises and stock-market crashes both at home and abroad in this time period. The money supply seems to have become unhinged from inflation. Most policy moves are made today with a fearful eye on how the bond and stock markets will react. And the guru of the whole era’s prosperity, Alan Greenspan, has nothing but stern words for the high-flying stock market. This potentially unstable combination of interlocking psychologies and ultimate dependence on the Fed to do what is right when the Fed itself seems puzzled over what is going on, does not look like an “automatic adjustment” economy to me. In fact it looks very much like the kind of economy Keynes was describing in the General Theory. Is this what the advocates of the supposedly unmanaged economies of old have in mind?

The French Aristocracy and Jesuits together vehemently opposed Diderot’s Encyclopedie. They were astute enough to realize the threat of Diderot’s self-consciously secular system of knowledge becoming widely disseminated. It was not dangerous that the Philosophes were themselves embracing a new language in which to conduct their professional conversations. What was dangerous was for the 2000 subscribers and the members of the Paris salons in which they gathered, to begin to notice that the entries on government and morality put forth in the Encyclopedie declared their position to be derivative of natural laws and not divine or ecclesiastical authority. If this view were to become widespread, they correctly sensed, the basis of the Ancien Regime was at risk.

Today in macroeconomics we have a curious reversal of this old conflict between social authority and profane science. The ‘science’ of macroeconomics itself has retreated into a kind of religiosity – what Keynes, complaining of his classical critics, called “scholasticism.” To him this was a discussion that proceeds in a kind of infinite loop, sustained by shared cherished assumptions that are not allowed to be questioned- like continuous market clearing and the insistence on modeling all choice as if it were made by rational anticipation of the consequences in situations defined by the impossibility of such anticipation. The risk of such private conversations is that Macroeconomics may be in the process of becoming irrelevant. Meanwhile the macroeconomy marches forward and policy analysis has become the province of non-economist policy analysts and low-status (within the economics profession) government staff economists. Much of the toolkit of these (evidently very successful) practitioners are filled with theories and tools that modern highbrow theory has relegated to historians and outmoded “Keynesians.” Many of these tools are profiled in the encyclopedia under review.

Michael S . Lawlor is Professor of Economics at Wake Forest University. His most recent publication on Keynes was the chapter “The Classical Theory of the Rate of Interest,” in G.C. Harcourt and P.A. Riach, eds, 1997. A ‘Second Edition’ of The General Theory. Lon don and New York: Routledge.

REFERENCES

Darnton, Robert, 1979. The Business of the Enlightenment: A Publishing History of the Encyclopedia. Cambridge: Harvard University Press

Diebold, Francis X., and Glenn D. Rudebusch. ” Have Postwar Economic Fluctuations Been Stabilized?” American Economic Review, 82 (1992): 993-1005.

Eatwell, John, Murray Milgate and Peter Newman, eds. 1987. The New Palgrave: A Dictionary of Economics. London: Macmillan.

Glasner, David, ed., 1997. Business Cycles and Depressions: An Encyclopedia. New York and London: Garland.

Groenewegen, Peter D. 1995. A Soaring Eagle: Alfred Marshall 1842-1924. Aldershot: Edward Elgar.

Harcourt, G.C. and Peter Riach, eds. 1997. A ‘Second Edition’ of The General Theory. London and New York: Routledge.

International Monetary Fund, 1999. Chronic Unemployment in the Euro Area: Causes and Cures. Washington D.C.: International Monetary Fund.

Lebergott, Stanley. “Discussion.” Journal of Economic History 46 (1986): 367-71.

Romer, Christina D. “Is Stabilization of the Postwar economy of Figment of the Data?” American Economic Review 17 (1986): 314-34.

Weir, David. “The Reliability of Historical Macroeconomic Data for Comparing Cyclical Stability.” Journal of Economic History 4 6 (1986: 353-65).

Wood, John H. “A Company of Merchants:” A History of the Theories and Ideas That Have Shaped Monetary Policy. Forthcoming.

Yoo, Peter S. “The FOMC in 1997: A Real Conundrum.” Review of the Federal Reserve Bank of St. Louis 80:5 (19 98): 27-40.

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Published by EH.NET (August 1999)

Lance E. Davis, Robert E. Gallman

and Karen Gleiter, In Pursuit of Leviathan: Technology, Institutions,

Productivity and Profits in American Whaling, 1816 – 1906. Chicago:

University of Chicago Press,, 1997. Xii +

550 pp. $80.00 (cloth), ISBN: 0-226-13789-9.

Reviewed for EH.NET by Donald G. Paterson, Department of Economics,

University of British Columbia.

It is said of Herman Melville that he toned down the detail of Moby Dick

because his Victorian readership would have found it too disturbing and highly

fantastical. Davis, Gallman and Gleiter provide the story that Melville left

out. A history of American, mostly New England, whaling in the nineteenth

century, this book deals with the technology and institutions of this ephemeral

industry. It examines the course of productivity that saved the industry

numerous times as the prices of whale products fell and the business forces

that led men to hunt the whale fish.

This is a book written with style and an exemplary economy of argument. The

authors are content to

tell the story with an abundance of evidence and the economics just necessary

to the main theme. There are many instances in the book where, one suspects, in

the hands of less seasoned veterans the reader might have to wade through the

best of modern theory and interpret elaborate and novel econometric tests. For

instance, there is no explicit use of modern fishery models and search theory.

However, it will be clear to any reader who is familiar with formal fishery

modeling that the authors rest their work on that foundation. The complex

economics of natural resource depletion are fully understood by the authors,

which of course is no surprise, and their economic narrative reflects this

fact. The result is an elegant and easy-to-read history that is highly

accessible.

The book traces the growth of the US whaling industry from its expansion into

the Pacific to its decline in the last years of the nineteenth century. In the

early years the Americans were in competition with the British whalers but

curiously the main discussion of this is left to late in the book (Chapter

12). Some, if not all, of this material belongs earlier in the text. Throughout

the authors assemble a vast array of quantitative information. Readers who are

familiar with the Starbuck data published in the 1870s will be pleased to see

how this information has been supplemented by extending the data beyond the

1870s, by providing more information on each vessel-voyage, and by the

inclusion of the records of other ports. (Starbuck recorded the customs

information for New Bedford and adjacent ports by voyage). With this most

impressive data collection the authors examine, each in a separate chapter: the

natural resource base;

labor; capital; the technology of the hunt; productivity, profits and the

roles of the entrepreneurs and middlemen. I found several of the sub-themes in

various chapters particularly interesting. One is the change in the size and

rigs of ships as the whalers sought to find the most efficient combination of

capital/lab or consistent with a particular type of whaling voyage. Another is

the system of payments to labor in the industry that from the earliest of times

was payment by share. On this subject there is a very nice discussion of the

allocation of risk. Readers will find many other well-contained topics.

Although whaling was never an industry central to overall US growth it did have

great importance in the regional economy of New England. Its rise was

coincident with the decline in New England farm productivity. However, the

wide appeal of this book will come from its completeness in following a

renewable natural resource industry through its rise and decline. Economic

historians, business historians and American historians in general will find

the book of interest. Students of American literature with aspirations to

enter the Melville industry must read this book to be current. In Pursuit of

Leviathan would also be an excellent supplement in both undergraduate and

graduate courses in natural resource economics.

Donald G. Paterson is Professor of Economics at the University of British

Columbia. He is the author (with W.L. Marr) of Canada: An Economic

History (Macmillan, 1980) and has published on the history of the North

Pacific fur seal fishery.

Published by EH.NET (August 1999)

Solomos Solomou, Economic Cycles: Long Cycles and Business Cycles since

1870. Manchester: Manchester University Press, 1998. x + 132 pp. $79.95

(paper), ISBN: 0-7190-4150-3; $27.95 (paper), ISBN: 0-7190-4151-1.

Reviewed for EH.NET by Forrest Capie, Department of Banking and Finance, City

University Business School, London.

To the economic historian it seems odd that from time to time economists talk

about the end of the business cycle. In the late 1920s, economists,

in the US in particular, were proclaiming an end of the business cycle, after

a long period of boom. Unfortunately, there followed almost immediately the

worst cyclical downturn of all times–though that did not seem to dent the

reputation of economists. Again in the 1960s macroeconomists were talking of th

e end of the business cycle, regrettably just before the worst postwar

recession. (Look out for these forecasts and sell!) Solomou’s plea is that for

any study of business cycles a long historical period needs to be held in view;

and when it is, it can of

course be seen, that while the nature of the cycle changes, the cycle does not

disappear. One of the many splendid things about this short book is to knock

the “death of the business cycle” story on the head, and indeed go further and

accept that cycles

will always be present.

The book is in a series designed for students, policymakers, and practitioners.

In other words it is designed to survey the literature on the subject in a

critical way and summarize the principal strands. It is in two main parts.

The first and somewhat longer part is on business cycles since 1870, and the

second is on long economic fluctuations. Each of these parts has appended a

substantial bibliography; and there is a short concluding chapter on the

lessons that can be drawn from a consideration of the analysis.

There are two principal ways of looking at business cycles. One is to see them

as the consequence of internally generated dynamics, and the other is to see

external shocks as the source. And there is the possibility of international

transmission through a fixed exchange- rate system. Solomou considers these

approaches, examines the main types of shocks, describes cyclical behavior

across the period, and provides an explanation based on an analysis. In the

process he brings out the considerable differences in cyclical behavior in the

three periods: 1870-1914, 1919-39, and 1945 onwards. The second part of the

book deals with two kinds of cycles:

Kuznets (20 years), and Kondratiev (50 years). There has been more interest in

recent times on the latter but both of these require an even longer historical

period for description and analysis; but then lack of data quickly becomes a

problem.

If reviewers are obliged to find a fault, mine would be to query the

significance attributed to the role of agriculture in the cycle after 1870.

If it was simply claimed that weather was a significant shock there would be

little cause for complaint since there is a case for the construction and

perhaps other sectors being seriously affected.

But that would be to quibble and the wrong note on which to end, for this book

can be recommended unreservedly to undergraduates and others.

Forrest Capie has written, co-written or edited sixteen books and over a

hundred articles on monetary, banking

and trade topics. His recent publications include: Tariffs and Growth

(Manchester University Press,

1994); The Future of Central Banking (Cambridge University Press 1995)

with Charles Goodhart and Stanley Fischer; Monetary Economics in the

1990s (Ma cmillan 1996); and Asset Prices and the Real Economy ed.

with G. E. Wood (Macmillan 1997). He is Editor of the Economic History

Review.

Published by EH.NET (Ju ly 1999)

Seymour Drescher and Stanley L. Engerman, editors, A Historical Guide to World Slavery. New York: Oxford University Press, 1998. xxiv + 429 pp. $75.00 (cloth), ISBN: 0-19-512091-4.

Reviewed for EH.NET by Robert Whaples, Department of Economics, Wake Forest University.

Seymour Drescher (University of Pittsburgh) and Stanley Engerman (University of Rochester) have assembled a stellar cast which has written an exceptionally useful reference book. The goal of the nearly one hundred contributors to A Historical Guide to World Slavery is to bring slavery into a “worldwide and cross-cultural focus.” The entries in this volume do this very well. They will be useful to students and scholars alike, as they provide both an accessible overview of the complexities of the subject and a starting point for further research. The authors’ collective ability to be simultaneously concise and informative is striking.

The entries cover an impressive range. The volume begins with a twenty-se ven page entry on “Abolition and Anti-Slavery” in which individual authors examine events in Africa, India, Southeast Asia, Britain, Continental Europe, Latin America, and the United States. It closes with a short essay on “Wage Slavery.” In between are a wide range of entries covering topics such as “Art and Illustration,” “Biblical Literature,” “Family,” “Forced Labor: Soviet Union,” “Gender and Slavery,” “Historiography,” “Manumission,” “Maroons,” “Middle Passage,” “Nazi Slavery,” “Psychology,” “Race and Racism,” “Religion,” “Reproduction,” “Revolts,” “Serfdom,” and “Urban Slavery.” Points of interest include an introductory essay on “The Problem of Slavery” by David Brion Davis, a six-page entry on “Contemporary Slavery” and an unexpectedly detailed three-page entry on “Eunuchs.” Nearly one-quarter of the guide focuses on slavery in particular regions and countries, including Africa (23 pages), Asia (11 pages), Brazil, Canada, the Caribbean (22 pages), Central America, China, Europe, the Mediterranean , Oceania, Russia, South America, and the United States (10 pages).

EH.NET subscribers will find this work to be a valuable resource. Among the entries that will be of most interest to economic historians are those on: -The “Asiento” (the monopoly contract awarded by Spain to supply her colonies in the Americas with African slaves) by Colin Palmer. -“Capitalism and Slavery” in which Joseph Inikori argues that recently “discovered evidence and newer analytical frameworks . . . make it clear that African slavery in the Americas was a critical factor in the development of capitalism in England between 1650 and 1850 (p. 109).” -“Demography” by Barry Higman. -“Economics” in which Richard Steckel focuses mainly on the U.S. South. He concludes that research “in the past two decades has overturned the image of slaves as lazy and inept, established slave-owners as rational capitalists, demonstrated that Southerners were largely independent of Western food supplies, and shown that slave workers were well-nourished while young children had extraordinarily poor health (p. 183).” -“Forced Labor” by Ralph Shlomowitz, which examines indentured servitude, convict labor, and other similar institutions around the world. -“Indentured Servitude” by David Galenson. -“Industrial Slavery” by Charles Dew. -“Mortality in Transport” by Raymond Cohn. -“Occupations” by David Murray. -“Penal Slavery” by Farley Grubb. -A seven-part entry on the “Slave Trade” by Ralph Shlomowitz, Ross Samson, Ralph Austen, David Eltis, Robert Edgar Conrad, David Murray, and David Richardson; -And an entry on slavery in the U.S. South in which Gavin Wright points out that “North American slavery was less essential to the economy than was true for most other major slave systems” (p. 401), provides an ex tended discussion of the “efficiency” debate, and concludes that “slavery in the American South did not create an economy well-suited for rapid integration into the capitalist world (p. 405).”

This guide will be an especially helpful teaching tool. It is a must for any college library.

Robert Whaples Department of Economics Wake Forest University

Robert Whaples is Associate Director of EH.NET and author of “Where Is There a Consensus among American Economic Historians? The Results of a Survey on Forty Propositions,” Journal of Economic History, March 1995.

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Published by EH.NET (July 1999)

Elizabeth T. Bor is and C. Eugene Steuerle. Nonprofits and Government:

Collaboration and Conflict. Washington, D.C.: The Urban Press, 1999.

xii + 383pp. Tables, notes, bibliographies, index. $57.50 (cloth), ISBN

0-87766-687-5; $29.50 (paper), ISBN 0-87766-686-3.

Reviewed for H-Business and EH.NET by Milton Goldin, National Coalition of

Independent Scholars (NCIS).

The New Gospel of Wealth

Today, in the second Gilded Age, a hundred years after the first,

scholars at universities and think tanks have replaced clerics and muckraking

journalists as primary observers of America’s philanthropic system. And

government has replaced the private sector as financier of welfare services.

But no one has replaced the Reverend Walter Rauschenbusch, Lincoln Steffens,

Ida Tarbell, and others like them,

individuals who attempted to tie together charity, the generosity of the very

rich, social justice, and public outlays. Nor has any scholar emerged as a

latter-day Thorstein Veblen, the University of Chicago gadfly whose writings

discombobulated robber barons.

Nonprofits and Government, an Urban Institute tour de horizon of

philanthropy at the turn of the 20th century, consists of a foreword by William

Gorham, the institute’s president, an introduction by Elizabeth T. Boris,

director of the institute’s Center on Nonprofits and Philanthropy, and ten

essays by various scholars. As a summary of current relationships between

501(c)3 organizations and Washington, and as insight into who among savants

thinks what,

it is a must-read, not only for individuals who work in government, the media,

and nonprofits but for business historians who want to know where the economy

stands with respect to voluntary organizations.

Gorham writes that “there is a nonprofit organization to fill almost every

imaginable human need or interest…. Regardless of their individual origins,

these organizations create relationships and networks that connect people to

each other and enable them to work toward mutual goals” (p. xi). Four

paragraphs later and more expansive,

he tells us that “Nonprofit organizations have been called the glue that holds

civil society together.” This prepares the way for Boris’s comment that

“relationships such as those fostered by choral societies, bowling leagues,

and other community associations build the trust and cooperation that is

essential for the effective functioning of society,

politics, and [the] economy” (p. 18).

From that point, however, the text takes on a steely tone. Writers set about

demolishing some of our most treasured philanthropic understandings. If you

believe that corporations have a genuine interest in preserving traditional

American community values, consider Dennis R.

Young’s claim that despite “massive gifts” by George Soros and Ted

Turner, “corporate philanthropy generally is becoming more of an exercise in

strategic marketing and employee morale-building than [in]

corporate social responsibility” (p. 82). If you believe that Americans are

extraordinarily generous, consider C. Eugene Steuerle and Virginia A.

Hodgkinson’s view that “In 1996, charitable giving stood at 1.9 percent of

personal income, slightly [sic] below its post-1964 average of 2.3 percent . .

. .” And, given media stories about staggering sums raised, if you believe

that private giving pays for social services,

ponder the same two authors’ observation that nonprofits receive in donated

funds “about one-twelfth of the government’s social welfare spending” (p. 79).

So much for starters. Conservative writers fondly argue that cutting taxes

increases amounts raised for charity. But Alan J. Abramson, Lester M. Salamon,

and Steuerle tell us that “on balance, the overall thrust of tax policy [that

is, tax benefits for the very rich] in the 1980s and 1990s appears to have

weakened the financial incentive for charitable giving” (p. 121). The wealthy

“experienced sharp increases in the after-tax cost of giving between 1980 and

1994, when the after-tax price of giving $1 rose from 30 cents to 69 cents

between 1980 and 1991 and then fell back to about 60 cents in 1994 and beyond”

(p. 122). The result of this process was that the wealthy came to the belief

that it was better to create tax shelters than to seek deductions after making

charitable gifts.

In neither conservative

nor liberal camps do scholars question that tax exemptions provide nonprofits

with benefits that are denied for-profits.

Nonprofits get to keep nearly all the surplus they earn from a variety of

income-producing activities, ranging from fees for services,

to cost-plus programs on behalf of public agencies, to for-profit ventures.

The other side of the coin is that tax exemption means that government annually

certifies a nonprofit’s operations. (Which is actually less and less of a

problem, as the IRS keeps cutting the number of employees available to

investigate exempt organizations.)

These situations lead John H.

Goddeeris and Burton A. Weisbrod into one of the

most interesting discussions in the book, “Not for-Profit?

Conversions and Public Policy,” in

which they address the question, Why should a growing number of nonprofits,

particularly those in health care, want to convert to for-profit status, given

certain incomes from public funds and fees?

Part of the answer, they tell us, hinges on the “non-distribution constraint”

imposed on nonprofits; that is, the restriction prohibiting distributions of

profits or surpluses to managers and/or trustees. As early as 1983, the answer

also began to hinge on cut-offs of federal grants and loans for HMOs and the

removal of tax advantages for Blue Cross and Blue Shield companies. Insiders

considered the loss of these benefits intolerable to their personal financial

gain, if the nonprofit had accumulated valuable assets. Moreover, “As the

market for hospital services has become more price competitive and the level

of over-capacity more apparent, hospitals have come to view affiliation with

larger organizations as necessary for survival. The most attractive suitors

have often, though not always, been for-profits” (p

. 250).

How we got to where we are today and whose interests have been served during

the journey, subjects addressed in part in all the essays, are discussed by

Young in an awesomely-titled essay, “Complementary,

Supplementary, or Adversarial? A Theoretical and Historical Examination of

Nonprofit-Government Relations in the United States” (pp. 31-67).

Young writes that “public policymakers,” both on the left and on the right,

have “oversimplified” views of nonprofits, although of late there have been

improvements. Even dedicated Reaganites no longer argue that if government

pulls

out of welfare programs, nonprofits and volunteers will happily take over

responsibilities, using donated funds. On their part, liberals agree that the

centralized welfare state

should be dismantled to some degree and that local nonprofits should assume

more responsibility.

Young further suggests that differing understandings of philanthropy’s role

should not be surprising. Three theories of the role of voluntary organizations

in the national life, in some ways contradictory, have been operative since the

founding of the Republic. In a “supplementary model,” nonprofits fulfill a

demand for public goods left unsatisfied by government. In a “complementary

view,” nonprofits operate as partners with government, to deliver public

goods. And in an “adversarial view,”

nonprofits exist mainly to prod government into adjusting its policies to

provide public goods.

The problem is that Young’s explanation does not go far enough to address a

new trend, as the 20th century comes to an end. We are currently in the midst

of the greatest transfer of wealth in world history. Possibly between five and

six trillion dollars (no one knows for certain) is either already in, or en

route to, foundations,

charitable remainder trusts, and similar financial creations, dispatched by the

World War II generation and the first Baby Boomers to retire.

Unlike their predecessors during the first Gilded Age, these rich often have

little or no interest in philanthropy. Preservation of capital is not just

part of the story, it is very nearly all of the story. What will happen to the

philanthropic system as the rich park more and more of their assets in

tax-sheltered instruments is anyone’s guess. There is no discussion of this

development in Nonprofits and Government.

Published by EH.NET (July 1999)

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Neil A. Hamilton. American Business Leaders. Santa Barbara, California: ABC-Clio, 1998. 1 CD-ROM and user’s guide. standalone $49; lab pack (5 discs) $129; network (unlimited use) $199.

System Requirements: Windows: Windows 95, Windows NT 4.0, Windows 98; Pentium-compatible processor running at 75MHz or faster; 16MB RAM (32MB recommended); hard drive with at least 30MB free space; SVG A monitor, 640 x 480, 256 colors, small fonts; Windows-compatible mouse or pointing device; 4X-speed CD-ROM drive.

Reviewed for H-Business and EH.Net by K. Austin Kerr, Department of History, Ohio State University.

This CD is a convenient if limited use of the medium to provide students with an attractive and easy to use reference. The author of the entries is Neal A. Hamilton, who has brought his expertise as a professional historian to the task. (Hamilton has also written American Business Leaders: A Biographical Dictionary issued by the same publisher in June, 1999) Here Hamilton and the publisher’s staff have provided over four hundred short biographies of American business leaders. Although the selection criteria are not apparent, important figures from colonial times (e.g., John Jacob Astor) to the present (e.g., Katharine Graham) appear. Each biography is clearly written, and includes hyperlinks to places and definitions of terms (e.g., great depression; communism). Most entries include an image of the individual. Each entry concludes with a brief bibliography for further reference.

The entries rely on up-to-date sources, scholarly works when available and journalistic pieces for more recent figures. Each entry is easy to read and appears to summarize accurately the most important information about a subject’s business career. The display is attractive, and is easy to export to a printer or to a word-processing program in rich text format.

The interface for the user is the best I have seen on a CD. Installation procedures went quickly on my computer running the Windows 98 operating system. There are several ways a user can navigate the CD: with a search for a name, a subject, or a text string (the latter using a convenient form to guide the user through the Boolean logic of the search engine). The user can also look for “attributes,” such as all Caucasian women born after a particular date, and from the resulting list select biographies to read. Another useful feature, for someone trying to relate the biographical information to a historical context, is the timeline feature. The user can search for a subject, and, once obtaining the list of names, have the computer display those names on a timeline relating to some main events in American history. From that timeline, the user can then click on a name to obtain the biography. The program also includes its own notebook feature, allowing a user to take notes without exiting. It is also possible to toggle between the program and another one already running on the computer.

The only complaint I have about the interface is the way the program takes control of the windows desktop. Users can use Windows toggle keys (Alt + Tab) to go to an already running word processor. Today’s computers are commonly capable of multi-tasking, but in this case the task must be running before loading American Business Leaders. (Presumably many users will already have a word processor file open, if they are using this CD as a reference work, so they will have no problem in this regard as long as they remember the key combination for toggling between running programs.)

ABC Clio has aimed this CD to the broadest market, schools and libraries below the collegiate level. This is not a reference work for advanced work. It does feature hypertext, which can be useful (and also sometimes confusing when facing the need to structure information in the clearest, most useable manner). Thus when reading an entry, the user can obtain definitions of terms like “plantation” or “communism” and maps to provide the user with a basic geographical orientation. With the hypertext, search, and sort capabilities, the medium has exploited its advantages over the traditional printed reference work.

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