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The Story of Reo Joe: Work, Kin and Community in Autotown, U.S.A.

Author(s):Fine, Lisa M.
Reviewer(s):Boyd Jr., Lawrence W.

Published by EH.NET (August 2006)

Lisa M. Fine, The Story of Reo Joe: Work, Kin and Community in Autotown, U.S.A.. Philadelphia: Temple University Press, 2004. xii + 239 pp. $23 (paperback), ISBN: 1-59213-258-8.

Reviewed for EH.NET by Lawrence W. Boyd Jr., Center for Labor Education and Research, University of Hawaii at West Oahu.

Lisa M. Fine (Associate Professor of History at Michigan State University) has done something both unusual and difficult. She has written a social history of a small-to-medium-sized factory in a small-to-medium-sized Midwestern city. The factory was operated by various incarnations of the Reo Motor Car Company in Lansing, Michigan between 1904 and 1975. Reo was an acronym for Ransom E. Olds and was the second automobile company this entrepreneur founded. The first company he founded, Oldsmobile, also operated in Lansing in one form or another for over one hundred years. Reo Joe is the name of a sort of “everyman” who worked in the automobile industry in Lansing. As the author states, “This book is about Reo Joe and his world: a city, an industry, and ideas about work, manhood, race and family” (p. 3). Fine includes gender as a category of analysis and emphasizes men and male identity in this work.

A simple thumbnail sketch of the story of the plant would go something like this: After experiencing labor problems in Detroit, Ransom E. Olds moved the plant to Lansing where he found a rural, largely white, Protestant workforce. The plant and community prospered for more than two decades. It struggled through the Depression; in 1937 a union was recognized following a sit-down strike and what amounted to a general strike in Lansing. Following these events the company declared bankruptcy. During 1939 it was rescued by a Reconstruction Finance Corporation loan and a government contract to produce trucks. Following World War II, it continued to produce trucks for the military during the Korean and Vietnam conflicts. In addition to producing civilian trucks, following World War II the factory diversified into lawnmowers. The plant struggled throughout the last twenty-five years of its existence, never really recapturing the position it had held in the twenties. Finally, urban renewal in 1973 closed the plant and the entrepreneur who had bought the plant, seems to have stolen the workers’ pension fund.

This would not be an unusual story in that it duplicates the experience of a large number of factories in the Midwest. Yet, few historians have attempted a plant-sized view and then tried to produce a broader social history of the people connected to the plant. Fine finds that the Reo plant consistently employed a relatively homogeneous workforce, with the proportion of foreign-born and African-American workers well below industry averages. Partly because of this, at least from its founding to the Great Depression, management and owners found workers receptive to an emphasis on the “factory family” and various aspects of welfare capitalism.

Within this broad context one learns, for example, that the Ku Klux Klan was active in Lansing, and that, possibly, Reo employees were part of this movement. The Klan in Lansing organized Labor Day parades, with an anti-immigrant theme. The Klan also campaigned for a state constitutional amendment that would require all school-age children to attend public schools. They also had candidates in the Republican primary for governor who ran on the basis of opposition to parochial schools and the Catholic Church. One of these was a Lansing area minister, Frederick Perry, who was also a field organizer for the Klan. The author finds some evidence that Ransom Olds supported Perry’s ministry in 1910. At the time of these activities (1924) Perry spoke to about 1,500 workers at the Reo plant. In addition a local Klan leader was presented a Reo automobile by “men of the KKK” (p. 67). In an oral history interview, a former Reo worker, Layton Aves, states, “that in order to join the union you had to be a member of the KKK.” Fine suggests, “The popularity of the Klan in Lansing during the 1920’s challenges us to rethink how Reo Joe responded to the events of the 1930’s and made a union and New Deal of his own” (p. 64).

This raises some questions about this work. In a micro history of one plant and its neighborhood how does one assess the influences of a broader society and culture? How does one also assess the channels by which these influences come through to the employees of the plant? And how does one assess claims likes Aves’? That someone closely associated with the Klan, like Perry, was able to speak at the plant indicates upper-level management support, probably that of R. E. Olds himself. Internal evidence, however, does not support Aves’ statement. Lester Washburn, who worked at the plant from 1927 on, and who joined the union during 1933 and functioned as a local and international union leader does not mention joining the Klan or associating with the Klan. This example illustrates both the strengths and weaknesses of this work. On the one hand, one gets a really interesting snapshot of the times and society at the plant and in Lansing. On the other hand, one would like more weighing of evidence and more of a broader context as to what Fine is reporting.

By context I mean that ideas and social attitudes tend to be widespread and interact with members of the “factory family.” To put it more succinctly who was Reo Joe? Did he change his mind about things? Or was he the sort of elderly guy who at seventy-five still had the same views he had in the 1920’s. He probably was a bit more of a metrosexual during World War II, as the work force included far more women, and a bit more nonwhite, and “hip” during the sixties. The author’s metaphor tends to obscure these changes, and tends to stress continuity more than change.

This is the sort of labor history that economic historians will find useful, and interesting. One suspects that an economic history of the plant would find that it failed largely because it could not take advantage of the economies of scale that other automakers enjoyed. Its reliance on piece rates into the 1950’s would tend to indicate it did not develop the sort of mass production assembly that other auto manufacturers did. One would also like to have seen more about wages and incomes at the plant, and thereby some idea of the standards of living of employees. It would have been even more useful had the publisher included a bibliography as well as the very detailed and exhaustive endnotes. These are all relatively mild blemishes, however, on a fine work.

Lawrence W. Boyd Jr. is an Associate Specialist at the Center for Labor Education and Research at the University of Hawaii at West Oahu. He is currently working on an analysis of wages and prices between 1920 and 1940 in the United States.

Subject(s):Labor and Employment History
Geographic Area(s):North America
Time Period(s):20th Century: WWII and post-WWII

The Great Debate on Banking Reform: Nelson Aldrich and the Origins of the Fed

Author(s):Wicker, Elmus
Reviewer(s):Tallman, Ellis W.

Published by EH.NET (August 2006)

Elmus Wicker, The Great Debate on Banking Reform: Nelson Aldrich and the Origins of the Fed. Columbus, OH: Ohio State University Press, 2005. xii + 120 pp. $35 (cloth), ISBN: 0-8142-1000-7.

Reviewed for EH.NET by Ellis W. Tallman, Federal Reserve Bank of Atlanta.

Elmus Wicker has written another important book for understanding a crucial portion of the complex economic history of the United States’s banking system. The book describes the evolution of the banking reform debate that took place between 1894 and 1913 in newspapers, magazines, and political discourse, documenting the sharp turns it took along with changes in the key reform proposals from the most influential reformers. The book ends with Wicker suggesting that the creation of the Fed may have been accidental. Although the conclusion is debatable, the book will likely motivate further research on the banking reform movement and should appeal particularly to the specialist in the monetary history of the United States.

The core of the book centers on how the banking reform debate evolved from the initial asset-based currency proposals arising from the interior banks toward the central bank-like plans (mainly from the New York City banking interests) that culminated in the passage of the Federal Reserve Act. Wicker presents essential details on various banking reform proposals, the key participants, and the main tenets of the reforms and he makes it clear that the path toward the establishment of a central banking entity was circuitous.

For the context of banking reform, it helps to provide a brief synopsis of the cornerstone events spurring the debate. During the Banking Crisis of 1893, the New York City national banks left interior banks to fend for themselves by restricting convertibility of deposits into currency. Under existing banking legislation, banks outside New York City could not increase their currency supply when demand required it, but instead relied on their reserves on deposit at New York City national banks. In reform proposals, the banks outside New York City wanted to reduce their dependence on New York City national banks when emergency cash needs arose. Asset-based currency provisions would reduce that dependence. New York City bankers opposed asset-based currency proposals, instead supporting (though half-heartedly) central bank proposals. These positions held generally prior to the Panic of 1907.

In a brief book, each chapter takes on a mission and Chapter 3, entitled “The Quest for an Asset-Based Currency, 1894-1908” argues that initial banking reform proposals aimed to repair the flaws of the National Banking System: seasonal money market stringency and banking panics. The initial reform proposals wrangled with “inelasticity of the currency,” that is, the failure of currency (note issuance from banks especially) to respond to changes in demand, most notably, the seasonal demands from the agricultural cycle. The book provides a complete analysis of proposals and reform movements, and the descriptions retain a thematic continuity to the title. The Baltimore Plan in 1894 was conceived by bankers in the Baltimore Clearing House who then presented a proposal for currency reform at the American Bankers’ Association annual convention. Wicker presents the detailed asset-based currency proposal of the Baltimore Plan, emphasizing that the plan was not uniformly supported by reformers with similar views. For example, J. Laurence Laughlin, chairman of the Department of Economics at the University of Chicago, perceived that the key constraint in a banking panic was access to credit, which was not going to be fixed by additional currency. Laughlin’s subsequent participation in the Indianapolis Monetary Commission in 1897 links together the discussion of the two reform movements, making clear that the latter reform gained from the work of the Baltimore Plan. The Indianapolis Monetary Commission had as its goal the appointment of a National Monetary Commission, much like the one commissioned in the Aldrich-Vreeland Act of 1908.

Wicker describes several other less well known reform proposals that deserve notice. Among the other banking reform proposals, the Pratt Bill of 1903 would have authorized each clearinghouse with the right to issue currency on the collateral of its general assets, thereby offering asset-based currency only through the clearinghouses rather than individual banks. This innovative element was similar to the portion of the Aldrich-Vreeland Act that allowed clearinghouses the authority to issue “emergency currency.”

The New York Chamber of Commerce Report in 1906 proposed a banking reform that promoted the establishment of a European-style central bank. Arising from New York City business leaders, the proposal provides a key contrast to the proposals from outside New York City. Frank Vanderlip, an executive at National City Bank in New York City, participated in the effort, although he apparently was unconvinced by the final draft of the proposal. It was a notable outlier among the reform proposals prior to the Panic of 1907.

The book leaves two key questions relatively unanswered. First, Wicker asks how it was that the Midwestern, interior banking forces that initiated the serious effort toward reform lost the leadership of the banking reform movement to Wall Street bankers. Without that leadership, the interior banking interests had limited influence on the shape and content to the banking reform legislation. I think that the book understates the effect that the Panic of 1907 had on the banking reform debate. Wicker describes the Columbia University Lectures, a set of prepared lectures held in New York City on banking and financial market reform presented by a list of distinguished bankers, scholars, and public servants. The motivation for the lecture series arose from the aftermath of the Panic of 1907, which had affected New York City banks and financial markets most intensely. As a result, New York City banking interests had a heightened interest in the banking reform debate. The influence of the Wall Street bankers on the reform proposals in 1908 and afterward changed the contents of the banking reform debate. Separately, Wicker argues that bank reform shifted toward the creation of a central bank and lost its focus on panic prevention. This loss of focus in the banking reform movement on its initial motivation is not fully developed in the book, and offers some opportunities for additional inquiries.

The second question that the book raises but then does not fully answer refers to the change in the perspective on banking reform of the central political character of the book, Nelson Aldrich, Senator from Rhode Island and Chairman of the Senate Banking Committee. The text describes how Aldrich left the United States to visit European central banks; at the time of his departure, Aldrich believed in the efficacy of currency reform, perhaps some form of asset-based currency legislation. Upon his return, though, Aldrich was an advocate of establishing a central bank in the United States. The discussion leaves the reader asking “why did he change his mind?” It is left for further research to uncover whether there was an event or particular observation that led Aldrich to change his mind. The address by Aldrich in the National Monetary Commission (Volume XX) emphasizes the absence of large-scale credit disruptions in Europe over the period in which the United States faced several serious crises, but there is no revelation of what caused his notable change of view.

The description of the infamous Jekyll Island cabal and its role in the conception and creation of the Aldrich Bill offers perhaps the most accessible content for the general interest reader. Wicker describes the key personalities, their views, and their role in the creative process. The participants of Jekyll Island meeting were Nelson Aldrich, Henry P. Davison (a partner of J.P. Morgan and Co.), A. Piatt Andrew (a Harvard economics professor on leave as Assistant Treasury Secretary), Frank Vanderlip (second in command to James Stillman at National City Bank), and Paul Warburg (an investment banker from Kuhn-Loeb). Wicker emphasizes the absence of Benjamin Strong from the list of participants, and provides ample source material to underline that fact. Otherwise, the discussion of the Aldrich Bill is concise and accurate to set up a comparison with the Owen-Glass Bill that was eventually passed as legislation for the creation of the Federal Reserve System.

The discussion of the Glass Bill examines an overlooked antecedent in the Muhleman Plan. Apparently, it is one of three proposals that H. Parker Willis, assistant to Carter Glass and often referred to as a central figure in the drafting of the Glass Bill, summarized for the Glass subcommittee. Wicker also describes Victor Morawetz’s plan for regional reserve banks, in which the each district has considerable autonomy, a notable difference from the Aldrich Bill. Regional district autonomy was adapted to the Glass Bill.

The book spends substantial text highlighting the differences and similarities of the Aldrich and Glass-Owen Bills. The differences were huge, despite the obvious benefit that the Owen-Glass Bill received from the Aldrich Bill as blueprint. The Aldrich Bill left the National Reserve Association as an entity run by bankers with some political oversight, whereas the Owen-Glass Bill reversed the roles. In terms of currency, the Aldrich Bill maintained currency as bank issue, whereas the Owen-Glass Bill made currency an obligation of the U.S. Treasury. With respect to the regional structure and districts, the Aldrich Bill was somewhat more centralized than the Owen-Glass Bill. The autonomy of the district banks in the Owen-Glass Bill contrasted with the Aldrich Bill proposal, and in retrospect, such autonomy likely hindered coordination within the Federal Reserve System during the Great Depression. The similarities of the two bills provide backdrop for another central theme of the book.

The subtitle of the book is Nelson Aldrich and the Origins of the Fed and the author makes no secret of his intention to acknowledge the debt owed to Nelson Aldrich for the successful passage of the Federal Reserve Act. The point is well-argued, well-worth making, and it is simple. Nelson Aldrich participated in the investigation of other central banks, he was crucial in guiding the momentum for banking reform toward the establishment of a central bank, and he coordinated the writing of the Aldrich Bill, which was an important blueprint for the Owen-Glass Bill. Aldrich was able to push the debate far enough to allow discussion of an institution that could be referred to as a central bank. For seven preceding decades in the United States, there was innate aversion to any proposal for a central bank. The contribution of Aldrich to the success of the Owen-Glass Bill, both in its content and in its passage, seems unmistakable.

The contribution of this book is more than a summary of central points on bank reform proposals and their shortcomings. Instead, it offers a comprehensive yet concise analysis of the great American debate on banking reform. The book should become required reading for those interested in U.S. monetary and financial history, as a synopsis of the banking reform proposals as well as the development and passage of the Federal Reserve Act.

Ellis W. Tallman is Vice President in the Macro Policy Group of the Research Department at the Federal Reserve Bank of Atlanta. His research interests in economic history focus on financial crises and specifically on the Panic of 1907 in the United States. He and his frequent co-author Jon Moen are completing a manuscript of a book examining the economic arguments that supported the movement to establish a central bank in the United States in the early twentieth century.

Subject(s):Financial Markets, Financial Institutions, and Monetary History
Geographic Area(s):North America
Time Period(s):20th Century: Pre WWII

Institutions and the Path to the Modern Economy: Lessons from Medieval Trade

Author(s):Greif, Avner
Reviewer(s):Hoffman, Philip T.

Published by EH.NET (August 2006)

Avner Greif, Institutions and the Path to the Modern Economy: Lessons from Medieval Trade. New York: Cambridge University Press, 2006. xix + 503 pp. $35 (paperback), ISBN: 0-521-67134-5.

Reviewed for EH.NET by Philip T. Hoffman, Division of Humanities and Social Sciences, California Institute of Technology.

Institutions have captured the attention of many economic historians, and of many other social scientists as well, ever since Douglass North argued that they were the key to understanding long run growth. The widespread interest in institutions ought ultimately to boost the fortunes of economic historians, since they can rightfully maintain that they have something of a comparative advantage in the area. Who, after all, knows better how institutions work, how they change, and what real impact they have?

Economic historians will therefore welcome the appearance of Avner Greif’s new book, for among its many virtues, it offers a new and far more profound way of thinking about institutions. Greif, of Stanford University, begins by setting aside the concept of institution that dominates much of economics and political science — namely, that institutions are politically determined rules which constrain behavior, such as laws or articles of a constitution. While this definition may suffice in some circumstances, it is really ill suited for analyzing why institutions change or why their effects seem to endure so long. Worse yet, it fails to explain why rules are followed in the first place. Saying that people follow rules because they fear the penalties for violating them is unsatisfactory, Greif points out, for what enforces the penalties and makes sure that the police and the courts punish the violators? Historians ought to know this better than anyone else, for we have all studied periods of history when order breaks down and enforcement of laws goes out the window.

Greif’s answer is to conceive of an institution as more than just a rule, because there has to be something behind the rule if it is in fact observed. For Greif, an institution is thus a system of rules, beliefs, norms, and organizations that together generate regular social behavior. Consider, for example, the rule from the criminal law that outlaws theft. Part of the reason the law is observed is that it is enforced by organizations such as the police and the courts. But beliefs and norms are at work too. A person will only heed the law if he has internalized a norm that frowns upon theft or if he believes that police are likely to catch him if he tries to steal and that nothing he can do (such as trying to bribe judges or the police) will change the outcome in his favor. In many places, the organizations, beliefs, and norms work, and the rules against theft work. The result is a regularity of behavior — low crime rates. But in other places, that is not the case. In Chicago in the 1950s, for instance, certain jewelry thieves could go about their business with relative impunity, provided they paid off the police or had their lawyers bribe judges; the rule against burglarizing jewelry stores or holding up gem salesmen was not always observed. The thieves believed that bribing judges and the police would pay off, and at least in some cases it did. But their impunity did not extend to the nearby suburbs, where the police were apparently harder to corrupt.[1]

My account of Greif’s definition may seem a bit abstract, but Greif makes it come alive by using it to explore a number of illuminating examples drawn from the history of the Commercial Revolution in the Middle Ages. The examples (the Maghribi traders, medieval merchant guilds, the rise and fall of Genoa, the medieval origins of impersonal exchange, and its ties to the common practice of holding whole communities responsible for individual debts) not only yield a much deeper understanding of how institutions operate but they also shed light on fundamental questions of economic history– in particular, why the West and the Muslim World diverged in the late Middle Ages. To make sense of these examples, Greif uses two tools — game theory and careful historical analysis. Neither tool, he argues persuasively, is sufficient by itself, and those who would try to probe institutions with game theory alone are therefore making a terrible mistake. To understand institutions — and in particular, to grasp how they change — requires a historian’s painstaking attention to the context, and for that reason alone economic historians ought to rejoice in his book, for it amounts to a powerful defense of economic history within the discipline of economics.

That is not the only reason Greif’s book should appeal to economic historians, for he also manages to explain why institutions have such long lasting effects and when it is they themselves will change. And he does all this while drawing upon fields ranging from sociology to political science, which should win the book readers throughout all of the social sciences.

Will they all agree with everything Greif says? Perhaps not, but they will have to take him seriously, because his book represents the cutting edge when it comes to the study of institutions. Some readers may perhaps want more quantitative evidence, but they will have to admit that Greif’s analytic histories are quite persuasive, and they will have to acknowledge too that appropriate econometric testing of the sort of game theoretical models Greif uses is still in its infancy. Other readers may worry that the historical evidence is perhaps consistent with different game theoretical equilibria and thus with different treatments of Greif’s examples. They can certainly make their case, but in the end their accounts are likely to end up complementing Greif’s analysis, rather than being a substitute for it.

And that is perhaps another virtue of this path breaking book: by creating new tools for studying institutions, it is likely to inspire research for years to come. By all rights it deserves to do so, in economics, in sociology, in political science, in law, and (to the extent that historians in history departments pay attention to the social sciences) in history too. Economic historians obviously have special reason to prize the book, since it takes up some of the biggest issues in the field and makes a vigorous case for economic history within the larger discipline of economics. But other social scientists will highly value it too, and it will be no surprise if it ends up becoming — and rightfully so — a classic.

Reference: 1. Edward Baumann, Polish Robbin’ Hoods: Inside Story of the Panczko Brothers – The World’s Busiest Burglars. Los Angeles: Bonus Books, 1992.

Philip T. Hoffman, who is Richard and Barbara Rosenberg Professor of History and Social Science at the California Institute of Technology, has recently finished Surviving Large Losses (forthcoming, Harvard University Press), a study of financial crises, coauthored with Gilles Postel-Vinay and Jean-Laurent Rosenthal.

Subject(s):Markets and Institutions
Geographic Area(s):Middle East
Time Period(s):Medieval

Historical Statistics of the United States, Volume Two: Work and Welfare

Author(s):Carter, Susan B.
Gartner, Scott Sigmund
Haines, Michael R.
Olmstead, Alan L.
Sutch, Richard
Wright, Gavin
Reviewer(s):Maloney, Thomas N.

Published by EH.NET (August 2006)

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Susan B. Carter, Scott Sigmund Gartner, Michael R. Haines, Alan L. Olmstead, Richard Sutch, and Gavin Wright, editors, Historical Statistics of the United States, Volume Two: Work and Welfare. New York: Cambridge University Press, 2006. xiv + 964 pp. $825 (for the five-volume set), ISBN: 0-521-58540-6.

Reviewed for EH.NET by Thomas N. Maloney, Department of Economics, University of Utah.

This book distills into one massive but handy volume the efforts of an inestimable number of researchers to quantify the development of labor market outcomes and living standards in U.S. history. It contains nearly ten thousand data series (or columns of data), spread across nearly one thousand pages, covering the following topics: “labor,” including labor force participation, occupations, wages, hours and working conditions, union participation, and household production; slavery; education; health; economic inequality and poverty; social insurance and public assistance; and nonprofit, voluntary, and religious entities. (The other four volumes in the Historical Statistics project cover “population,” “economic structure and performance,” “economic sectors,” and “governance and international relations.”)

While the agglomeration of all these data series is the obvious purpose of this project, the book also contains a series of essays introducing the data on each topic and providing context. These essays are uniformly well-written and useful. They are also quite accessible, which should make this volume an important resource for interested groups beyond the scholarly community. While the essays share these qualities, they also vary in their purposes and strengths.

A few of the essays provide an extensive amount of analytical discussion in addition to introducing the data series on a given topic. Susan B. Carter’s essay on “Labor” is practically a short course in U.S. economic history, examining the rise in living standards over time as it relates to increases in labor force participation and increases in the productivity of employed workers. Linda Barrington and Gordon M. Fisher’s essay on “Poverty,” while narrower in its focus, is similar in that it provides a very extensive, analytical discussion of changes in the concept of poverty over time and the implications of these changes for the measurement of poverty.

One of the main virtues of a reference work like this is that it can integrate related material that exists in many disparate and perhaps obscure original sources. A few of the essays (and their related data series) are especially valuable in this way, including Robert A. Margo’s contribution on “Wages,” William A Sundstrom’s piece on “Hours and Working Conditions,” Lee A. Craig’s essay on “Household Production,” Stephen T. Ziliak and Joan Underhill Hannon’s “Public Assistance: Colonial Times to the 1920s,” and Peter Dobkin Hall and Colin B. Burke’s essay on “Nonprofit, Voluntary, and Religious Entities.”

In other chapters, the data come largely from well-known sources. Nearly all of the material on occupations, for instance, comes from the Integrated Public Use Microdata Series (IPUMS) Census samples, and much of the information on social welfare and social insurance programs in the twentieth century comes from the Social Security Bulletin. Even in these cases, though, the essays (by Matthew Sobek on “Occupations” and by Price V. Fishback and Melissa A. Thomasson on “Social Welfare: 1929 to the Present”) provide very useful insights into the proper interpretation of the numbers and changes in their meaning over time.

I would single out Claudia Goldin’s essay on “Education” as being particularly valuable as a guide to the use of the included data. Goldin provides an appendix to her essay in which she consolidates her discussion of sources, comments on how these series relate to those provided in prior editions of Historical Statistics, and also guides researchers to the best sources for future updates of these series. I hesitate to suggest this, having some sense of the gargantuan effort already expended on this work, but if any ongoing revisions are planned for the online version of this project, a brief appendix for each section, following Goldin’s model, would be a nice addition.

I obviously can not comment in detail on all of the included data series. I will note that I was struck by the breadth of the material included, even given my high expectations (and the thickness of the volume). The material on “Health,” overseen by Richard H. Steckel, goes well beyond the measures of well-being associated with anthropometric work and includes information on health care expenditure, the availability of hospitals and other health care facilities (and their use), insurance coverage, the supply of physicians and nurses, the prevalence of smoking and drug use, the composition of diets, and a number of other related phenomena. Similarly, Goldin’s chapter on education incorporates a wealth of detail not only on educational attainment but on subjects studied in school, faculty and staff numbers, standardized test scores, and higher education costs.

As inclusive as the volume is, though, there are some probably unavoidable holes. By design, national totals are emphasized, and very few of the series are presented in a geographically disaggregated way. In addition, some series that one might expect to find in this volume are presented elsewhere in the five-volume set and not repeated here. For instance, much of the material related to colonial-era slavery apparently appears in volume 5 (“Governance and International Relations”), chapter Eg (“Colonial Statistics”), and not in the “Slavery” chapter of this volume. This obviously should not be too great an inconvenience for individuals at institutions that acquire the complete five-volume set and the online version. I am certainly urging my university’s library to do so.

Thomas N. Maloney is an Associate Professor in the Department of Economics at the University of Utah. His research focuses on race, migration, and labor markets in the U.S. His recent work includes “Ghettos and Jobs in History: Neighborhood Effects on African American Occupational Status and Mobility in World War I-Era Cincinnati,” Social Science History 29:2.

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Subject(s):Social and Cultural History, including Race, Ethnicity and Gender
Geographic Area(s):North America
Time Period(s):20th Century: WWII and post-WWII

Financial Founding Fathers: The Men Who Made America Rich

Author(s):Wright, Robert E.
Cowen, David J.
Reviewer(s):Gunderson, Gerald

Published by EH.NET (July 2006)

Robert E. Wright and David J. Cowen, Financial Founding Fathers: The Men Who Made America Rich. Chicago: University of Chicago Press, 2006. v + 240 pp. $25 (cloth), ISBN: 0-226-91068-7.

Reviewed for EH.NET by Gerald Gunderson, Shelby Cullom Davis Endowment, Trinity College.

This book is comprised of short biographies of those believed to be most influential in the development of the financial system during the early national period in the United States. There are the usual suspects, Alexander Hamilton and Robert Morris, but also some that seldom are mentioned, such as William Duer and Thomas Willing.

The accounts move along fluidly and the authors are not shy about assigning credit or blame. Hamilton receives the customary praise but Andrew Jackson does not get the criticism one might have expected for someone who killed the national bank. Rather, the argument seems to be that by time of his presidency the financial system had developed to the degree that its alternatives were not that much worse. This last chapter — combined with discussions of Nicholas Biddle — departs from the usual pattern of the book. The other financial entrepreneurs — outside of the scoundrels such as Duer — are generally thought to have played important roles in developing the economy. This point can be argued, here and elsewhere in history. Do entrepreneurs have a large, independent role in the growth of new products and technologies or are they often implementing changes that would soon appear in any case? To the authors’ credit, and the readers’ benefit, these arguments in Financial Founding Fathers are thoughtfully developed and clearly stated.

The book is enjoyable to read. Each entrepreneur is portrayed playing a role — “Creator,” “Judas,” “Sinner,” and “Savior” — for example. And the narrative seems natural, not stretched to cover a framework that skews the examples. You will enjoy this book and it can be used for a wide range of audiences from a supplementary reading for undergraduates to a departure for discussions in seminars to a good read on your flight home from a conference.

Gerald Gunderson is Shelby Cullom Davis Professor of American Business and Economic Enterprise at Trinity College, Hartford, Connecticut.

Subject(s):Financial Markets, Financial Institutions, and Monetary History
Geographic Area(s):North America
Time Period(s):19th Century

Jay Cooke’s Gamble: The Northern Pacific Railroad, the Sioux, and the Panic of 1873

Author(s):Lubetkin, M. John
Reviewer(s):Fender, Ann Harper

Published by EH.NET (July 2006)

M. John Lubetkin, Jay Cooke’s Gamble: The Northern Pacific Railroad, the Sioux, and the Panic of 1873. Norman, OK: University of Oklahoma Press, 2006. xviii + 380 pp. $30 (hardcover), ISBN: 0-8061-3740-1.

Reviewed for EH.NET by Ann Harper Fender, Department of Economics, Gettysburg College.

Lubetkin’s major contribution lies in his description, based on numerous primary sources, of the Northern Pacific Railroad’s surveys in the summers of 1871, 1872, and 1873 for its line through the Dakota/Montana territories. A prologue of several chapters provides a setting for the surveys by examining the history of the Northern Pacific Railroad and Jay Cooke’s involvement with it. Early chapters of the book also summarize Cooke’s life and business dealings, especially his selling of Civil War bonds, prior to his involvement with the Northern Pacific. Additional chapters include material on the history of North American European/Indian contact and an interesting technological history of surveying. An epilogue of sorts follows the chapters on the surveys. These chapters focus on the problems of the Northern Pacific, the downfall of Jay Cooke & Co., and the Panic of 1873 and ensuing depression. Along the way, Lubetkin introduces a large, colorful cast of characters, with impressive biographical material about each. He weaves together the unlikely components of his title. U.S. Grant, Sitting Bull, George Custer, Confederate general turned railroad surveyor Tom Rosser, various financial saints and villains, alcoholic generals, the geography of Minnesota and Dakota and Montana territories and their extreme weather are among the people and conditions in his story. A postscript briefly describes what happened to the book’s main characters after 1873; an appendix summarizes an eyewitness account of a post-blizzard rescue of an 1871 surveying party.

The story begins when Jay Cooke, casting about after 1865 for a way to use his bond sales expertise, became interested in Minnesota and virtually empty lands west of it. Simultaneously, the Northern Pacific Railroad, existing in name only, had fallen into the hands of Vermont businessman and politician, J.Gregory Smith, who needed cash and apparently thought he might get it through the proceeds of Northern Pacific bond sales. Smith, the clearest villain of the book, presided over the Vermont Central Railroad. Why anyone would think that a second transcontinental railroad was a good idea so soon after the completion of the first is a bit of a mystery (until one recalls the recent “dot.com” bust). Cooke was sufficiently cautious to send in 1870 an expeditionary group to examine the lands along a potential Northern Pacific route from Lake Superior to Puget Sound. That group reported rich soils, possible coal seams, and abundant timber along various parts of the route, which encouraged Cooke to raise money for the railroad. Additional interest was created by what was soon to become Yellowstone National Park and its potential tourism business. Federal land grants along the route gave the promise of funds to complete the line and enrich investors. One cautionary note arose with the unknown area between roughly Bismarck and the Yellowstone River. Nomadic Sioux tribes, having been compressed into this region, understandably did not want their hunting territory further decreased. Pressure from the Crow tribe to the south and from Metis to the north made incursions by settlers intolerable for the Sioux. Despite this Indian threat, the Northern Pacific proceeded, with lines being constructed from east and west. Simultaneously, surveyors were hired to mark the line in the unknown Yellowstone region. Because of the Sioux threat, military escorts accompanied the surveyors; the survey took three summers, partly because Indian attacks materialized. These surveying expeditions included many hundreds of men, wagons, and animals, and created substantial provisioning nightmares. Using his sources Lubetkin brings alive the expeditions and the problems that vexed them. Various Civil War veterans staffed the Dakota Territory military units; an ex-Confederate general was surveyor and then chief engineer for the Northern Pacific. Especially on the 1873 expedition, which included the colorful and self-promoting George Custer, newspapermen were included and made regular reports to eastern papers.

One of the author’s main contentions is that stories filed by these reporters and by Custer greatly exaggerated the Indian attacks, thereby scaring off potential NPRR bond purchasers. This in turn led to problems for the railroad and for Cooke and Co., which had committed substantial resources to it. Cooke’s New York partners, concerned that Cooke had over-committed to the railroad, took (perhaps duplicitous) actions that shut down Cooke’s banking houses and effectively put Cooke into personal bankruptcy. The failure of Jay Cooke & Co. strongly contributed to the Panic of 1873. These contentions along with the descriptions of the nefarious spending and contracting practices of Northern Pacific executives and the relationships between businessmen and politicians, are interesting business history, but without the numbers and detail that might test quantitatively the contentions. Although Lubetkin deserves high marks for pulling together these facets, it seems likely that macroeconomic conditions and slowing credit growth caused the panic and the downfall of Cooke. Lubetkin’s economic history is narrative rather than cliometric, historical rather than economic. Although not expressed as such, however, issues of network industries, economies of scale, principal-agent problems, public choice, and rent seeking fill his book.

Both the book’s “Preface” and the accompanying publisher’s brochure explain how Lubetkin, a retired cable television executive, came to write Jay Cooke’s Gamble and it is a story that gives hope to cynical college professors. The author, as an undergraduate at Union College in the 1950s, found in his fraternity house a book about the College’s class of 1868. He returned to the subject of that volume many years later to write a book. One class member was Edward Jordan, later a surveyor for the Northern Pacific. Lubetkin located Jordan’s journals and correspondence about the Yellowstone surveys. These led him to the research for his second book. Lubetkin writes with infectious enthusiasm. He provides considerable detail. His extensive bibliography includes an impressive array of primary sources; even his secondary sources tend to be from regional historical magazines that are not widely accessible. (He has contributed some of his primary sources to the U.S. Military History Institute in Carlisle, PA.) The book includes old photos of people and places, modern photos that Lubetkin has taken of locations pertinent to the story, and modern renditions of historical maps. The book seems exhaustively researched. Whether it includes the latest more narrowly academic sources on Jay Cooke and others active in railroads and finance circa 1873 I cannot address, but most of the biographies he cites are fairly old. If these are the latest, it seems likely that Lubetkin has opened, or perhaps reopened, a fruitful avenue of research. Certainly his book is informative on a wide array of topics and great fun to read.

Ann Harper Fender is professor of economics at Gettysburg College. Her last publication, “Experimental Economics,” appeared in the papers of a conference at the Varna Economics University, Bulgaria, and resulted from a Fulbright Fellowship in Bulgaria. She is currently working on a book about the fur trade based on Hudson’s Bay Company journals and is contemplating the economic similarities among the fur trade, nineteenth century railroads, and twentieth/first century telecommunications.

Subject(s):Transport and Distribution, Energy, and Other Services
Geographic Area(s):North America
Time Period(s):19th Century

Historical Statistics of the United States, Volume Three: Economic Structure and Performance

Author(s):Carter, Susan B.
Gartner, Scott Sigmund
Haines, Michael R.
Olmstead, Alan L.
Sutch, Richard
Wright, Gavin
Reviewer(s):Davis, Joseph H.

Published by EH.NET (July 2006)

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Susan B. Carter, Scott Sigmund Gartner, Michael R. Haines, Alan L. Olmstead, Richard Sutch, and Gavin Wright, editors, Historical Statistics of the United States, Volume Three: Economic Structure and Performance. New York: Cambridge University Press, 2006. xiv + 831 pp. $825 (for the five-volume set), ISBN: 0-521-81790-0.

Reviewed for EH.NET by Joseph H. Davis, The Vanguard Group.

This volume of Historical Statistics is comprised of nine chapters and, in most cases, focuses on annual data and their sources. The objective is a straightforward if not ambitious one: provide reliable and relevant data that characterize the evolution of the economic structure and performance of the United States. Of course, “reliable and relevant” are open to interpretation. In my judgment, this Millennial volume does a better job than its Bicentennial predecessor, a noteworthy achievement.

The first two chapters of the volume focus on the prominent macroeconomic data on the trend in national output (first chapter) and business cycles (second chapter). I wish that I had had Richard Sutch’s introduction to these two chapters while in graduate school. Sutch provides an excellent summary on the history of national income accounting and the official NIPA estimates. Along with Paul Rhode, Sutch also provides a much-needed summary on the state of affairs regarding conjectural real GDP estimates before 1929.

The first chapter also introduces a new annual series on real GDP beginning in 1790. Referred to as the Millennial Edition Series, Sutch characterizes his real GDP estimates in the footnotes as “a pastiche reflecting the work of many contributors,” which is no exaggeration given the copious series documentation. In effect, the real GDP Millennial Edition Series is the result of splicing the best available annual interpolators through the best available output benchmarks for the pre-Civil War period. However, one criticism of this series is that it should be accompanied by more disclaimers, and its construction should have been detailed in the introduction (rather than delegated to endnotes). Indeed, given the overview of the unresolved “excess volatility” debate in the introduction, how should this series be viewed? What statistical inferences can (and cannot) be drawn? Given the fact that the volume provides two long-running annual real GDP per capita series dating back to 1790 (the Millennial Edition Series, and an alternative estimated by Louis Johnston and Samuel Williamson for EH.NET using different source data), which one is preferred? While I believe that the Millennial Edition utilizes more appropriate data in its interpretation (disclaimer: some of the data used are my own), I believe that more discussion should have been dedicated to its limitations. In my opinion, these real GDP data may be used to control for long-term trends, but should not be used in testing for structural breaks in macroeconomic volatility over time.

As a minor quibble, some of the tables in the first two chapters do not include the latest revisions, such as the version of the Davis industrial production index used to interpolate the real GDP Millennial Edition Series. In addition, the business cycle dates presented in the second chapter focus solely on the NBER dates, and thus ignore subsequent revisions to the monthly NBER business cycle dates for the late 1800s and early 1900s (by Christina Romer), and revisions to the annual NBER cycles for the 1800s (by myself more recently).

The volume’s fourth chapter focuses on popular wholesale and consumer price indexes. Christopher Hanes, the chapter’s editor, provides a fantastic introduction on how price indexes are constructed, the general trend in aggregate U.S. price indexes since 1800, and a brief history of the most popular aggregate price indexes. Hanes even provides tables with examples of how the rate of change in a price level can be computed under different techniques, a valuable exercise for students. Also noteworthy are Hanes’s comments on (and caveats about) various index construction methods. Hanes also cautions on the usage of the longest historical aggregate price series, particularly the annual CPI for all items, which has been linked from various sources back to 1774. While available for some time among economic historians (and third-party providers such as Global Financial Data), Hanes suggests that researchers may wish to use the PPI (as opposed to the CPI) when controlling for the price level back through the 1800s on account of the scarcity of rent data prior to 1913.

Richard Sutch’s chapter on savings, capital and wealth should serve as must-reading for students of economics and public policy. Of particular note is his expert treatment of the oft-confusing definitions of various savings measures, and the distinction between national and personal savings. The annual data in the chapter include updates of many data series derived from the National Income and Product Accounts and the Flow of Fund Accounts.

I found the volume’s sixth section, entitled “Geography and the Environment,” one of the most interesting, perhaps because I have the least familiarity with this topic. The section discusses and presents data on a host of environmental and climate indicators. Certainly, the section should introduce an interesting array of time series to a broader audience, including annual data on the number of oil spills, North American geese population estimates, and the number of forest acres damaged by insects. The section also updates important weather data, including the annual mean temperature and precipitation from various city and climatological stations as early as 1780.

The volume’s seventh section is dedicated to science, technological change, and productivity. The section’s editors, Gavin Wright and Stanley Engerman, provide excellent and concise overviews of these phenomena, including the U.S. patent system, the rise of organized industrial research, productivity measures, and the rise of computer technology. The section updates various Bicentennial series, including annual patent data, R&D expenditures, and productivity indexes. Gavin Wright also assembles valuable statistics on computers, including performance indicators of computers and transistors beginning in 1946 with the ENIAC.

Naomi Lamoreaux’s introduction to the volume’s eighth section on the dynamics of U.S. business organization is simply excellent, and should serve as necessary reading for students of finance and history alike.

The volume’s final chapter on U.S. financial markets assembles various statistics on monetary aggregates, banking, insurance, and interest rates. In the end, this chapter will be heavily consulted by practitioners and researchers in empirical finance. Michael Bordo, the editor of the section, has assembled a solid chapter with the assistance of other leading minds in the history and evolution of the U.S. financial system. Contributors include Howard Bodenhorn and Eugene White on financial institutions and their regulation, Peter Rousseau on securities markets, and John James and Richard Sylla on debt, the flow of funds, and interest rates. Key financial series have been updated, including those for U.S. equity prices (as early as 1802), long-term bond yields (as early as 1798), and money market rates (as early as 1831).

Like its 1975 predecessor, this reference volume set stands to be among the most widely cited works in economic history. The third volume updates the most popular macroeconomic and financial data, and in most cases does so with the careful assistance of leading scholars. Beyond the data, this volume also provides critical information as to the data sources, their limitations, and their potential implications. Arguably, this context is as important as the data series themselves, since this volume will certainly play a role in educating the next generation of economists, analysts, and historians.

Joe Davis is a Principal within both the Investment Counseling & Research Department and the Fixed Income Group of The Vanguard Group, a mutual fund company based in Valley Forge, Pennsylvania with over $1 trillion assets under management. While not currently in academia, Davis is a Faculty Research Fellow of the National Bureau of Economic Research (NBER).

Subject(s):Macroeconomics and Fluctuations
Geographic Area(s):North America
Time Period(s):20th Century: WWII and post-WWII

The Battle of the Single European Market: Achievements and Economic Thought, 1945-2000

Author(s):Grin, Gilles
Reviewer(s):Gillingham, John

Published by EH.NET (July 2006)

Gilles Grin, The Battle of the Single European Market: Achievements and Economic Thought, 1945-2000. London: Kegan Paul, 2003. xvi + 375 pp. $144.50 (cloth), ISBN: 0-7103-0938-4.

Reviewed for EH.NET by John Gillingham, Department of History, University of Missouri — St. Louis.

This dissertation from the Graduate Institute of Geneva is long on explanation and short on interpretation, yet well worth the slog. Gilles Grins relates a familiar story. He examines in exhausting detail the early history of integration, explains (beginning with Jacob Viner) how economists have developed and debated the theory of customs unions, tracks the genesis and uneven growth of the internal market from 1985 to 2000, and tackles the outstanding unanswered question overhanging it — whether, in the end, the effort has been worthwhile. While the author’s lengthy exposition of economic theory is accurate, fair and often illuminating, the appreciative reader must also share Grin’s special taste for the EU’s jargonesque administrative terminology, convoluted bureaucratic procedures, and institutionalized thinking. The book would have been more solid, not to mention readable, if the author had managed to cut through such stuff. He did not, but instead remained captive of his subject. This lengthy book does not, as a result, shed new light on the central question it raises. It is, however, a valuable quarry from which can be mined raw material, whose value, however, future writers will have to establish.

John Gillingham is the author of Design for a New Europe (2006), European Integration, 1950-2003 (2003) and Coal, Steel and the Rebirth of Europe, 1945 1955 (1991).

Subject(s):International and Domestic Trade and Relations
Geographic Area(s):Europe
Time Period(s):20th Century: WWII and post-WWII

Historical Statistics of the United States, Volume One: Population

Author(s):Carter, Susan B.
Gartner, Scott Sigmund
Haines, Michael R.
Olmstead, Alan L.
Sutch, Richard
Wright, Gavin
Reviewer(s):Logan, Trevon D.

Published by EH.NET (July 2006)

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Susan B. Carter, Scott Sigmund Gartner, Michael R. Haines, Alan L. Olmstead, Richard Sutch, and Gavin Wright, editors, Historical Statistics of the United States, Volume One: Population. New York: Cambridge University Press, 2006. xxviii + 807 pp. $825 (for the five-volume set), ISBN: 0-521-85389-3.

Reviewed for EH.NET by Trevon D. Logan, Department of Economics, Ohio State University.

When I was in graduate school, Ken Wachter once said that you could define the size of the demographic profession by counting everyone who had a Coale-Demeny life table in their office. If that is true, counting those with a copy of the Historical Statistics of the United States in their office could define the group of quantitative American historians in years past. It has been more than twenty-five years since a version was published, and there is one question that everyone seems to have about the new millennial edition: Was it worth the wait? This question is not merely a straw man. In the years since the bicentennial edition of Historical Statistics, the size and (more importantly) the quality of historical data have improved many times over. Even more, contemporary quantitative historians now have the ability, more so than in the past, to answer microeconomic questions with individual level historical data. The question “was it worth the wait?” speaks not only to the quality of the newest edition, but also its relevance to contemporary quantitative historical scholarship. As this review will show, however, the answer for this volume is an unequivocal, enthusiastic “yes.” Since no review of such a large work can hope to completely convey its contents, below I will sketch out the volume by chapter and follow with a general assessment of the work as a whole.

The introduction to the volume begins with basic definitions of population and methods for measuring and accounting for the growth of the population. It also covers broad changes in American demography from 1790 to the present as a means of foreshadowing the chapters that follow. The introduction then moves to a rather detailed discussion of race and ethnicity, moving from definitions and historical change in the concepts to the differences in demographic measures by racial and ethnic categories and a discussion of gender. This seems to be somewhat misplaced, but there is no other chapter in the volume where it will fit — the volume does not include separate chapters for race and gender, but rather integrates them into other features of the population. While I agree with this integrated approach, the discussion of race and gender is well integrated enough into the successive chapters that the discussion in the introduction is somewhat unnecessary. Overall, the introduction highlights the scope and size of the project, and also details the contents that follow.

The first chapter, on population characteristics, begins with a caveat about the reliability of Census counts of the population. It then moves to an excellent overview of the topics covered by the Census over time (such as education, urbanity, and household structure). One feature to highlight is the fact that population estimates for years between the decennial Census from 1790 to 1900 now use the method of change approach, and not linear interpolation. After detailing regional differences in population growth, the chapter concludes with a brief discussion of the Hispanic ethnicity designation. The tables that follow form the majority of the volume, and will most likely be the most utilized information in the volume. The tables include population size, density, marital status, rural and urban location by age, sex and race and summaries of the foreign-born population. The tables also contain state-by-state counts of age structure by sex and race, population density, and the foreign born. These tables form a treasure trove for those looking for summary population measures both aggregated and disaggregated (by state) over time.

The second chapter (which, like the first, is written by Michael Haines of Colgate University) deals with vital statistics of fertility, mortality, and nuptiality?. It is related to the first in that it gives the demographic information while the first chapter largely deals with population counts. The chapter begins by discussing how the American demographic transition was distinct from the transitions of Europe in that fertility declines in the United States predated mortality declines. Moving beyond description, there is a discussion of some of the theories of America’s unique fertility regime such as Sundstrom and David’s, Ransom and Sutch’s and the land availability hypotheses. Next, the chapter records how Census records can be used to construct some measures of fertility (such as children per woman), but that they are not as useful for tracking mortality. This leads to a discussion of estimates of mortality in the past, the general trend of declining American mortality since the end of the nineteenth century, and the development of the system of vital registrations — which allows for better estimates of mortality and for estimates of cause of death. Haines is very good at pointing out what we can and cannot say about fertility and mortality in the past, and his honest discussion serves as a warning to those who would wish to view the data that follow as gospel. The tables in this chapter include fertility, marriage, divorce, birth rates, and death rates by race; fertility ratios; and life expectancy by race and sex. There is an extensive collection of tables relating to infant mortality (including neonatal mortality, maternal mortality, and the fetal death rate by race). This is followed by cause of death tables, which highlight the conquest of mortality due to infectious disease in the twentieth century. The size and quality of the information on mortality are especially noteworthy given the caveat in the introductory note. Of special interest to demographers, the tables also include information on cohort survival (lx) necessary to construct life tables by race and sex over time.

Chapters 3 and 4 detail migration, both internal (chapter 3) and external (chapter 4). Joseph Ferrie of Northwestern University begins chapter 3 by noting that movements in internal population are an important aspect of American history. While the calculation of internal migration is straightforward theoretically, there are a number of data problems that complicate its empirical measurement. As such, the chapter is the most focused on data and methodology in the volume, but is also careful to highlight general trends. The tables that follow include migration by type and also changes in farm population over time. Our inability to measure internal migration accurately in the past does limit the interpretation of the data Ferrie provides. Chapter 4, by Bob Barde of UC-Berkeley and Susan Carter and Richard Sutch of UC-Riverside, starts with a technical definition of immigration and then moves to a discussion of the unique features of American immigration (the number immigrants, the number of nations involved, the lack of an American Diaspora). The chapter then details the American immigration experience, breaking the historical experience into three periods (1815-1920, 1920-1965, and 1965-present) which coincides with changes in immigration policy. It also covers the related (but distinct) topic of naturalization. As a reading, this chapter is a great introduction to both the history and politics of immigration in the United States. The tables that follow give immigration and emigration by country of departure; immigration by sex, race and age; admission numbers and demographics by immigration regime; and counts of persons naturalized.

The chapter on family and household composition, by Steven Ruggles of the University of Minnesota, is next. He begins by noting that previous editions of Historical Statistics did not contain any information about changes in families and households. He then details the problems of trying to look at trends over time as definitions of households and family have changed not only in the social psychology but also by government reporting standards. He also highlights some broad changes in household structure such as the decline in multigenerational households and the rise of single-parent, cohabiting, and single-person household. The ensuing tables give counts of households by race and sex of the household head; subfamilies; institution type; marital status of mothers with children by race; and the living arrangements of those aged 65 and over. Susan Carter’s chapter on cohort analysis is important to the extent that the previous chapters in the volume are period demographic measures? — that is, they are counts of persons and demographic phenomena at a point in time and therefore apply only to an imagined (synthetic) cohort. Cohort analysis is important since events experienced by cohorts can influence their lives and because period trends may not hold when subjected to cohort analysis, leading us to modify our interpretation of events and their consequences. Carter highlights these two facts in her chapter, and follows it with tables that show labor force participation, marriage, and education by age and sex by birth cohort.

The final chapter, by C. Matthew Snipp of Stanford University, is concerned with the demography of Native Americans. Snipp begins with coverage of the unique history that Native Americans have had in the United States, and also with the puzzle that, despite numerous documented interactions between the United States government and various tribes since colonial times, there is relatively little evidence about Native American demography. Snipp then lists the sources of information, taking great care to highlight the inherent caveats when dealing with the topic. The tables that follow are a unique resource, detailing the number of tribes; their size and populations by state; the demography of reservations, terminations of tribes; and the employment, occupations, and education of Native Americans.

In total, this volume of Historical Statistics is a triumph. The chapters provide first-rate introductions to their general area of focus, particularly helpful for researchers and students who are not specialists in either history or demography. Each chapter reading is informative without being burdensome. The voluminous tables are carefully documented and legible, and are disaggregated enough that one may look at interesting features by themselves. While researchers now seem to favor micro-based population research, this volume impresses upon me the importance of looking in the aggregate at underlying demographic trends. Demography is truly unique in that the individual measure directly relates to the population measure. As such, this volume complements the contemporary research agenda in quantitative history quite nicely by providing a background to core demographic measures. It is also quite useful for those whose research falls outside of these areas but who need measures for certain demographic phenomena at a point (and place) in time. The availability of the underlying data in electronic format gives a nod to the fact that the editors understand that the information in these volumes will form the backbone and background of many research projects. Given its numerous sources and size, this volume is a testament to the value of large-scale historical projects and also the value of interdisciplinary work. This work will not only be useful for quantitative American historians, but also for those in the social sciences and history in general who wish to put their research into historical and comparative perspective.

Trevon D. Logan is an Assistant Professor of Economics at Ohio State University and a Faculty Research Fellow at the National Bureau of Economic Research. Forthcoming publications include “Nutrition and Well-Being in the Late Nineteenth Century” in Journal of Economic History and “Food, Nutrition, and Substitution in the Late Nineteenth Century” in Explorations in Economic History.

Subject(s):Social and Cultural History, including Race, Ethnicity and Gender
Geographic Area(s):North America
Time Period(s):20th Century: WWII and post-WWII

The Birth of Big Business in the United States, 1860-1914: Commercial, Extractive and Industrial Enterprise

Author(s):Whitten, David O.
Whitten, Bessie E.
Reviewer(s):Mason, David L.

Published by EH.NET (July 2006)

David O. Whitten and Bessie E. Whitten, The Birth of Big Business in the United States, 1860-1914: Commercial, Extractive and Industrial Enterprise. Westport, CT: Praeger Publishing, 2005. xvi + 205 pp. $90 (cloth), ISBN: 0-313-32395-X.

Reviewed for EH.NET by David L. Mason, Department of Social Sciences, Georgia Perimeter College.

The roughly fifty-year period between the end of the Civil War and the start of World War I was one of the most dynamic periods in American economic history, in no small part because of the rise of big business. The Birth of Big Business in the United States, an introductory work intended for students and the general reader, chronicles the developments and processes that led to the rise of large-scale firms in both well-known industries like oil and steel, as well as in the extractive industries like mining and forestry. Throughout the concisely written narrative, the authors highlight the role of government in both encouraging and restraining the expansion of big business. This work succeeds in placing industrialization in the broader context of American history, an important consideration for first-time students of business history.

The book is organized into four major sections, the first of which sets the stage for the birth of big business. In the first chapter, the authors outline the effects of the Civil War on business development. The scale and scope of this conflict forced the government to assume an unprecedented role in the economy, and this need to satisfy the demand for goods and services had far reaching effects on business. Legislation and government incentives spurred innovations in finance, led to more efficient production methods, and promoted the increase in farming output. The war also caused existing industries (like railroads) to grow exponentially, while helping to establish new industries like oil. As the authors note, the experience of the Civil War not only helped business “overcome the hurdles between small-scale and national operations” (p. 17), but was instrumental in solidifying a relationship between government and business that would be critical in the growth of big business in the postwar era.

The first section concludes with a broad and comprehensive discussion of the changes in communications and transportation before and during industrialization. The authors cover all the major improvements (canals, cars, roads, airplanes, postal service, the telegraph and telephone), and they place a special emphasis on the role of government in fostering the success of these commercial enterprises. The chapter also provides sufficient factual details to give the reader a true understanding of how important these innovations were to the growth of big business.

The remaining three parts of the book (11 chapters) focus on specific industries and firms. Of these, the four chapters on retailing and the extractive industries are the most interesting and set this book apart, since these industries are often not included in comparable introductions to business history. The authors place these industries in a historical perspective and achieve a good balance of broad overviews with specific factual information. The chapter “The Commercial Response to a Mass Market” focuses on how urbanization sparked a revolution in the scale and scope of consumer retailing. The “Giant Farms” chapter gives an overview of the rice, sugar, corn and cattle industries, with an emphasis on how government land policy encouraged the development of the large farming enterprise. The chapter on forest products details how changes in technology and transportation after the Civil War transformed an industry dominated by small family-owned firms into one characterized by vertically-integrated businesses engaging in professional land management activities. The section on mining focuses primarily on how the struggles between coal producers and the railroads “swept independent mine operators into several large combinations that were themselves eventually forced to combine” (p. 112). Like the chapter on farming, the authors emphasize the role of the government in fostering business growth. Finally, all these chapters include brief discussions of the major firms in the respective industries and contain tables and factual details to illustrate the authors’ broader points.

The seven chapters that focus on specific big business firms tend to be more uneven than the industry overviews. These profiles include the United Fruit Company, Singer Sewing Machine, American Sugar Refining Company, American Tobacco Company, Standard Oil, U.S. Steel and the Meat Packers (Swift, Armour, Morris, and Cudahy), and they range in length from three to sixteen pages. While each is adequate for the target audience, more advanced students of business history would likely only have their appetites whetted.

The goal of The Birth of Big Business in the United States, 1860-1914 is to provide the student and general reader a concise yet comprehensive history of one of the most important periods in American economic history, and in large measure it succeeds. It offers a good foundation for understanding why big businesses appeared after the Civil War, and the role of the government in this process. As such it serves as a springboard for undergraduates and general readers who wish to delve deeper into the field of business history.

David Mason is an instructor at Georgia Perimeter College. His most recent book is From Buildings and Loans to Bailouts: A History of the American Savings and Loan Industry, 1831-1995 (Cambridge University Press, 2004).

Subject(s):Transport and Distribution, Energy, and Other Services
Geographic Area(s):North America
Time Period(s):20th Century: Pre WWII