What Business History Has to Say about Huawei, Geopolitical Jockeying, and the Battle to Sell Americans 5G Equipment

16 05 2019

In this blog post, I’m going to show how the research of two business historians is relevant to understanding the ongoing controversy about Huawei. The Chinese company Huawei is in the news again, thanks to Donald Trump signing a presidential order that declared that Chinese exports of telecoms equipment to the United States constitute both a national security threat and a national “emergency.” Given that Trump previously labelled Canadian and European steel exports to the U.S. a threat to national security, it is not surprising that the justification for the U.S. government’s attack on Huawei is not being taken seriously. As the BBC reported this morning, Trump’s executive order is “widely seen” as an attack on Huawei, a firm whose 5G products are competing with those of two European manufacturers, Ericsson and Nokia, and Samsung, a South Korean firm. For this interpretation of Trump’s executive order, see here, here, and here.

The French president, Macron, has rightly called Trump’s attitude to the Chinese firm “overprotectionism”. Many experts who have compared the Huawei’s products with those of its non-Chinese rivals have concluded that  Huawei’s equipment is smaller, more cost effective, and more energy efficient than equivalent products from its competitors, which implies that the U.S. consumers will lose out from the ban on Huawei products.

The immediate winners of Trump’s move would appear to be the U.S. subsidiaries of Ericsson, Samsung, and Nokia. As of yet, there is no direct evidence that any of these companies were involved in making Americans concerned about  Huawei. There’s no proof that these companies paid U.S. journalists or Congressmen to adopt anti-China, anti- Huawei stances, but that’s not unthinkable. I would note that when Borje Ekholm, the CEO of Ericsson, was asked about Trump’s executive order, he was remarkably restrained and did not join in the Huawei-bashing.  However, there is rising Sinophobia in the U.S. and that’s good news, at least in the short term, for the shareholders of Ericsson, Samsung, and Nokia, Huawei’s rivals, as well as for domestic U.S. firms competing with Chinese imports.(The US doesn’t have any companies that make 5G equipment).


This episode is certainly not the first historical instance of third-country firms benefitting from rising tensions between two countries. In the early twentieth century, the emergence of the movement for independent in India prompted many Indian firms and consumers to shun British-made goods. As the business historians Christina Lubinski and  Dan Wadhwani  discuss this dynamic in their new SMJ paper “Geopolitical jockeying: Economic nationalism and multinational strategy in historical perspective”. Their paper introduces the concept of “geopolitical jockeying” which is when a multinational firm attempts to delegitimize rival multinationals and position themselves as complementary to the economic and political goals of the host nation. I know that many business historians will tend to view the Huawei with relation to the wider trade war between the United States and China and the literature on the history of trade wars However, in thinking about the Huawei saga, I find it more useful to use the concept of  geopolitical jockeying.

Precursors of the Bottom of the Pyramid Strategy: Dan Wadhwani on the Origins of US Savings Banks

5 12 2017

The ABS 4* venue Journal of Management Studies has just published a new paper by Dan Wadhwani that is based on his PhD thesis research. Poverty’s Monument: Social Problems and Organizational Field Emergence in Historical Perspective offers a new perspective on the history of US savings banks that also helps us to think more clearly about the general phenomenon of how organizational fields emerge which is a . The savings banks discussed by Dan emerged in the early twentieth century to allow people at the bottom of society to have a safe means of saving for a rainy day. Social reformers created a new category of financial institution. Dan’s paper shows how these banks, which originally had a social-enterprise type of function evolved into quite large and sophisticated financial institutions. (I suppose that people who have read John Wilson et al.’s excellent history of the Cooperative Group may say “that’s a movie I’ve seen before’”). In fact, the “field drift” discussed by Dan is even more extreme—while the Cooperative Society and the Cooperative Bank still regard themselves as distinct from, and morally superior to ordinary for-profit supermarkets and banks, the savings banks discussed by Dan had, by 1900, evolved into pretty standard, profit-seeking banks.


One of the really neat empirical findings in Dan’s paper is these banks that were set up to serve the poor developed innovative techniques that were later adopted by financial institutions that serve the non-poor. Perhaps the most important of these innovations was the counter that separates customers from staff in most retail banks today. We now take this spatial arrangement for granted but it was actually pioneered by the savings banks as the struggled to cope with growing numbers of customers. Older banks, which had fewer but richer customers had no need for such counters.





This article draws on historical institutionalism as an approach to studying the relationship between business institutions and major social problems. Using the historical case of the emergence of savings banking as an organizational response to poverty in the nineteenth-century United States, I develop three conceptual claims about how social problems shape the processes of institutional and organizational change. First, I show how the “historical framing” of social problems shapes the processes of problematization, design, and legitimation related to institutional change. Second, I demonstrate how the dynamics of cooperation, competition, and alignment between an emerging organizational field and other fields shape the evolution of institutional responses to social problems. And finally, I illustrate how historical revisionism as a methodological approach can help management scholars re-consider settled empirical and theoretical claims in a way that takes social problems into account.

Dan presents some interesting insights into organizational field emergence. The savings banks are a particularly interesting case because the straddle the category of “profit-making financial institution” and “philanthropic organization.” Indeed, they are similar in that respect to the hybridized organizational forms discussed in a new(ish) paper by Janette Rutterford and Josephine Maltby. Nineteenth-century Britain saw the growth of charitable provision by limited-liability companies that are similar to today’s “social enterprises”. The social enterprise movement that emerged in the 1990s and which still won’t stop talking about its own novelty is actually really just a re-invention of some of the nineteenth-century organizations discussed by Wadhwani, Rutterford, and Maltby. (Actually, Rutterford and Maltby weren’t the first to point out the similarity between modern social entrepreneurs as their nineteenth-century precursors such as Octavia Hill–during David Cameron’s premiership, the memory of Octavia Hill was invoked by some of the proponents of the Big Society concept).


Although they may not be terribly interested in his important (to me) theoretical contribution, financial and banking historians such John Turner, etc should certainly take a look at Dan’s important paper.

Dan has chosen to interpret his sources in light of a set of theories drawn from organization studies. It occurs to me that one could also re-interpret his material in light of the late C. K. Prahalad’s concept of the Bottom of the Pyramid strategy. Prahalad looked at the seven billion people on the planet and realised that the people at the bottom of the pyramid (the two billion or so people living on less than 2 dollars a day) should be regarded by firms not charity cases but an important untapped market. His concept, which attracted the attention of both practitioners and academics, has helped to generate interest in this end of the market. I think that one could look at the US savings banks of the 19th century as having pursued a BoP strategy. Seeing these firms in this light actually makes some sense, since the US in the 19th century was, most metrics, much like today’s developing countries—GDP per capita in 1820 was $1,257 in 1990 dollars and many regions of the US had somewhat inclusive institutions, to use Acemoglu-Robinson terminology.

Ranking the Rankings: Which Ranking of Management Journals is the Most Credible?

3 07 2017

Journal rankings are extremely important in the management school world, so we business historians ought to give some thought as to the processes by which the different ranking systems are produced. It’s also crucial to see whether the journal rankings produced by different scholarly organizations (the UK’s Association of Business Schools, the Australian Deans’ List, CNRS, etc) are consistent with each other and with those created by for-profit outfits such as the Financial Times.   As I show below, there are some major discrepancies between the positions of journals on these lists. There are also differences in the degree of methodological rigour employed in the development of these lists.

Sadly, no business history journal was included in the all-important FT50 journal list. As I pointed out when this list was first published, the Financial Times has never revealed the methodology it used to rank these journals. The FT did inadvertently reveal the name of the individual who produced this list, one Laurent Ortmans. We know from LinkedIn that this individual is a graduate of Kingston University and the University of Rennes. We also know from other sources that some of the major management journals lobbied Mr. Ortmans intensively in the period when he was compiling the FT50 list, so perhaps the business history community will need to do so the next time he revises the list. Given its sheer importance to the working lives of academics in the British Isles and elsewhere, it is unfortunate that the FT50-Ortmans list is produced with so little methodological rigour. As far as I can tell, it is whipped up by a single individual who lacks a PhD. Pretty much the only thing I can say in defence of the FT50-Ortmans list is that there are no Japan-based journals on it (yet). Readers of the FT will have noted that ever since Pearson sold the FT to a Japanese company, there has been a surge in the number of articles about Japanese business in its pages. When I first heard of Nikkei’s purchase of the Financial Times, I was concerned that one or two really mediocre English-language journals published by elite Japanese universities might be added to the FT journal list. So far, that has not happened, which  I guess is to the credit of the FT50-Ortmans list. To be clear, there is good research being produced in Japanese universities, but it is typically published in either English-language international journals or in Japanese language journals and not so much English-language management journals edited at Japanese universities.

For business historians who work in UK management schools, perhaps the most important journal ranking is the one produced by the Chartered Association of Business Schools. Unlike the FT50-Ortmans list, part of the methodology behind the ABS guide is published. We know that the 2015 ABS list was produced under the supervision of a Scientific Committee that included leading scholars from various business-school disciplines. In 2015, committee’s expert on business and economic history was Geoffrey G. Jones Harvard Business School. It is not yet known who the historical expert hired to help produce the forthcoming 2017 ABS guide was. The ABS has wisely chosen not to release the name of the 2017 expert so as to preclude lobbying of the sort that took place prior to the release of the all-important FT50 list.  Keeping the name of the subject experts secret was a smart move on the part of the ABS and one that increases the credibility of their ranking system.

That being said, I’m not entirely convinced that the ABS journal ranking process is sufficiently transparent and robust for us to use it as actionable information.  The version of the ABS guide released in 2015 placed journals into five categories: 4*, 4, 3, 2, and 1. A variety of journals in the field of business history, economic history, and management history appeared on page 17 of the guide. (Note that in the 2010 version of the guide, there were separate lists for business history and economic history but that in 2015 these were lists were merged, perhaps in response to the growing importance of economic history in top econ departments).  In 2015, 26 historical journals were ranked. None were ranked 4* (the best possible ranking in the ABS 2015 system), but two were ranked 4, five were ranked 3, twelve were ranked 2, and seven were ranked 1.

Here are the relative positions of the journals in the 2015 ABS guide.

Business History Review 4

Economic History Review  4

Business History 3

Enterprise and Society 3

European Review of Economic History 3

Explorations in Economic History 3

Journal of Economic History 3

Entreprises et Histoire 2

European Journal of the History of Economic Thought 2

Financial History Review 2

Journal of the History of Economic Thought 2

Management and Organizational History 2

Journal of Management History 1


It is not clear what methodology will be used to create the 2017 guide.  According to the 2015 ABS guide, the classification process was “stringent and methodical in all cases” and “five sources of evidence” were used

  1. The assessments of leading researchers in each of the main fields and sub-fields covered; [AS: unfortunately, this criterion leaves room for subjectivity, especially since the written assessments were not published]
  2. The mean citation impact scores for the most recent five-year period (where available); [AS: ok, this part of the methodology is based on some actual hard numbers, which reduces the scope for subjectivity, which is good]
  3. Evaluation by the Editors and Scientific Committee members of the quality standards, track records, contents and processes of each journal included in the Guide; [AS: unless a detailed description of the working methods used by the Editors and a transcript of the deliberations of the Scientific Committee are published, this criterion would leave room for even more subjectivity]
  4. The number of times the journal was cited as a top journal in five lists taken to be representative of the ‘world’ rating of business and management journals [AS: Some hard numbers will be used here, which is positive because it gets us away from subjectivity]
  5. The length of time a journal has been established.[Again, a nice clear criterion that can be measured and independently confirmed].


Unfortunately, the ABS hasn’t published the formula they use to weigh these five factors. One hopes that the relative weighting of factors will be specified when the ABS releases the 2017 version of its list.  The ABS are to be commended for showing at least part of their work, unlike the Financial Times. Why anybody respects that FT50-Ortmans list is beyond me.


Let’s turn from the UK to the rankings of management journals used in other countries.  In many French business schools, the CNRS list is used. Journals are ranked from 1 to 4, with 1 being the best. If you publish in a journal ranked 1, you are rewarded more than if you publish in a 3 or 4 journal.  Version 1 of this ranking was published in 2004 and version 4 was released last year. Overall, the French rankings are not massively dissimilar to the British ABS rankings.  The Accounting History Review is ranked 3 in the French system and 2 in the UK system—it is thus a third-tier journal in both countries.  Accounting History is also ranked 3 in France.  So far, so good: the ratings look commensurate, which suggests the absence of home-nation bias and conflicts of interest. However, there are some discrepancies in the category “Business History Histoire des Affaires”  that are worthy of note.  The relative positions of the journals Business History and Business History Review reverse when one crosses the English Channel. In the CNRS system, Business History (2) is a higher ranked journal that the Business History Review (3). Moreover,  Management and Organizational History is ranked 2 in the UK system but has a lower ranking of 1 in the French system. Similarly, Entreprise et Histoire, a French journal, is lower ranked in France than it is in the UK.

I really like how the creators of the CNRS list of management journals frankly  concede in the preface of the document  that all rankings of journals are necessarily somewhat subjective. I really appreciate this degree of intellectual humility.

Elle ne peut évidement pas prétendre à la perfection, tout simplement parce que les appréciations trop raccourcies que peut fournir une telle liste sur des revues scientifiques (présence ou non sur la liste et rang de classement) sont évidemment des appréciations très réductrices et qui ne sont pas exemptes de subjectivité.



In Australian business schools, they use the ABDC Journal Quality List. In looking at the relative position of the historical journals on that list, one notices some interesting discrepancies between the relative positions of journals here and on the lists used in the UK and France. In Australia, journals are ranked A*, A, B, or C. Business History and Business History Review are both ranked A (second tier). So in France, Business History is considered to be better than BHR, in the UK BHR is better than BH, and in Australia they are viewed as equal.  Enterprise and Society is also considered an A journal in Australia. The really curious thing about the Australian list is that it Journal of Management History, which is ranked a lowly 1 in the UK, is highly ranked in Australia (it’s an A journal in the ABDC list). The editor of this journal, Bradley Bowden, teaches at Griffith Business School at Griffith University, Queensland. Bradley is a good scholar who is working hard to develop this journal, but the sheer discrepancy between this journal’s ranking in Australia and in other countries is worthy of discussion.

The role of ratings agencies in the 2008 financial crisis generated a great deal of interest in the wider social phenomenon of conflicts of interest in ratings.  This issue, which was dramatized in the film The Big Short, has investigated by academics who work in business schools around the world. Going forward, it will be interesting to see how the FT, ABDC, ABS, and CNRS ranking systems improve their credibility through improved methodological rigour and a higher degree of process transparency. I would strongly suggest that they work with the Center for Open Science as they move in this direction.  I am confident that improving the overall rigour of the process used to rank management-school journals would be a net benefit to the field of business history.

A journal’s Impact Factor is a relatively crude way of determining its quality, but at least it has the advantage of being measurable and independently verifiable. For the record, here are the impact factors of some journals in our field.

Business History 2016 Impact Factor: 0.830.   Ranking: 94/120 (Business); 5/35 (History of Social Sciences) in Thomson Reuters Journal Citation Reports. [Note: the 2015 IF appeared in an earlier version of this post].

Enterprise & Society 2016 Impact Factor: 0.593. Journal is ranked 14 out of 35 History of Social Sciences and 110 out of 121 Business in Thomson Reuters Journal Citation Reports.

Business History Review 2016 Impact Factor: 0.425. Ranking: 19/35 History of Social Sciences; 112/121 (Business)

Andrew Popp, the editor of Enterprise and Society, should be congratulated for the rapidly rising profile of this young(ish) journal. Even though he has not set out to chase Impact Factor, the high quality and innovative nature of the scholarship published in this journal has increased its IF as a sie effect.

Full disclosure: Andrew Popp is a colleague here at the University of Liverpool Management School.


Deglobalization: What Business Historians Can Teach Managers

26 03 2017


Deglobalization is the current buzzword, as I pointed out in a  blog post I published soon after the WEF meeting in Davos.  Actually economists have been talking talking about deglobalization for a number of years, ever since international trade as a share of world economic output began to decline. Now, however, CEOs and other top executives are really worried about how to respond to the rising levels of protectionist sentiment and the apparent trend in actual government policies towards protectionism.

Stephen D. King, the chief economist of HSBC, discusses deglobalization in a new book on the future of the global economy. King notes that we are in a very different historical epoch than the sunlit uplands of the 1990s, when globalization appeared unstoppable and public intellectuals announced the end of history and great power conflict. King sees a pattern that others have observed, namely that we are going back to an era of protectionism, nationalism, and  ethno-religious tensions similar to that of the interwar period of the 1920s and 1930s.  As a senior executive at a corporation that embodies the multicultural, multiracial global financial capitalism that emerged at the end of the twentieth century, King has very good reasons to be worried about deglobalization.  A similar historical analogy was used by Ruchir Sharma, Morgan Stanley’s chief global strategist in December 2016, although Sharma observed that today’s deglobalization  is somewhat different from the deglobalization of the interwar period .


It seems to me that mainstream strategy literature doesn’t appear to offer much guidance to managers seeking to formulate strategies to cope with the new phenomenon. Perhaps that’s because strategy professors haven’t yet had a chance to think about managerial responses to the newly discovered phenomenon.  Similarly, political science doesn’t  seem to offer a lot of practical advice to decision-makers in the private sector.  Michael Witt is a first-class political science/IR professor who teaches at INSEAD business school. If any political scientist could help executives to deal with deglobalization, it would be him.

Late last year,  Dr Witt wrote two pieces in which he pondered what deglobalization means for multinational firms. His first piece did an admirable job of summarizing the political science literature on globalization and deglobalization and tells people how two of the three main schools of thought in IR (Realism and Liberalism) view these phenomena. Somewhat curiously, Witt doesn’t say much as about Constructivism, another interpretative tradition in IR, which is unfortunate since constructivism has a great deal  to offer here. Anyway,  his second piece, which was published a week after the first one, sought to offer concrete advice to business executives interested in this topic. Sadly, the main pieces of managerial advice he provided weren’t that useful to managers.

Let me justify that assessment. Witt says that Liberal IR theory argues that  deglobalization is driven by rising inequality, which caused an upsurge of populist, anti-globalization sentiment from the parts of the electorate that have suffered from globalization.  Witt says that if firms wanted to continue doing business across borders, they need to shore up the political foundations of globalization by accepting a more progressive form of taxation. (Similar sentiments were heard from CEOs the January 2017 gathering in Davos).  Witt also argues recommends that  “longer-term investment plans should probably involve scenario planning”  that takes the re-imposition of tariffs into account.

The second piece of advice is sound and common-sensical, but the suggestion that senior executives do more to combat inequality  isn’t really practical, since a single CEO would be unable to combat rising inequality in their home country, unless that country happened to be very small and their firm was a major employer. There is a sort of free rider problem—if a CEO increases the wages his firm pays and no other firm follows suit, the CEO will have added to his costs without having done much to change the overall level of inequality in the country. A CEO operating in a corporate system dominated by Shareholder Value Ideology has very limited freedom to act.  That’s the problem with the argument that the left-wing venture capital Nick Hanauer made, when he said that CEOs who are worried about Trump’s protectionism should simply have paid their workers more.

It seems to me that Constructivist IR and, especially, my own home discipline of Business History could offer more useful advice to the makers of MNE strategy at this junction. (Business History informed by Constructivist IR could be a very powerful tool indeed).

The Constructivist approach to IR and International Political Economy (IPE) stresses that nations make policy in a cultural context that shapes how contemporaries view their self-interest. In other words, cultural differences such as gender ideologies, racial, religious, and ethno-national identities need to be taken into account. Deglobalization, both historically and in the present, appears to be associated with the rise in ethno-nationalist sentiment and growing hostility to the perceived other. While no single firm can reverse a pronounced trend in the culture towards  greater intolerance towards the Other, a group of firms, working together, can help to limit the spread of ethno-nationalist ideologies. For instance, they could do so by agreeing not to advertise on websites that promote the alt-right mentality that is congruent with tariff protectionism (see here).

Business history provides even more concrete advice. As business and economic historians know, deglobalization has happened before, most famously with the outbreak of the First World War. We can look to see how firms at the time handled deglobalization. Business historians have shown that a classic response to the imposition of tariff barriers is for firms to create local manufacturing subsidiaries within foreign nations.

There are other lessons about how to deal with deglobalization that managers can take from the historical record.    In a paper I published in an international-business journal, I discussed how the Hongkong and Shanghai Banking Corporation dealt with the First World War, a crisis that had the potential to destroy the corporation. HSBC, which was founded in 1865 and which had a multinational shareholder base and board of directors on the eve of the First World War, embodied that the open and cosmopolitan capitalism of the late nineteenth century, an era that was marked by falling trade barriers and increasing interconnectedness. HSBC was able to survive the First World War by paying close attention to the state of public opinion in Britain, which became increasingly xenophobic, and by severing ties to its German shareholders, directors and customers and by purging its executive workforce of a prominent individual of German-Jewish ancestry. HSBC was a much less profitable firm at the end of the conflict, but unlike many of the international banks in existence in August 1914, it survived the war. My paper aimed to use the historical experience of HSBC in war to identify lessons for the managers of present-day firms confronted with war and other drivers of deglobalization. One of these  lessons for present day managers is that conserving political capital in periods of heightened tensions between nations or other imagined communities may require the ruthless termination of relationships with people who are associated with the Other, at least insofar as the law of the land permits. (Note that I’m not saying that such a strategy would be morally right, just that it has worked in the past for firms). Another lesson that wartime managers could take from my paper on HSBC in WWI is that preserving legitimacy in the home country requires the head office to exert more control over overseas managers, less they embarrass the MNE in the home country, than would be the case in a time of generally good international relations.

There are important lessons for managers in the edited collection on the impact of the First World War on firm strategy was released by Routledge.  This book brought together the research of a business historians who use corporate archives. It is a common place among economic historians and historians of globalization to say that First World War end a long period of globalization and initiated a long period of deglobalization that that continued until after 1945. The edited collection was intended to help explore how firms confronted with a radical change in their operating environment responded. The papers in the collected documented a range of creative managerial responses to the First World War and its aftermath that included the creation of trans-national interfirm research alliances (see the paper by McGlade),  the adoption of new legal forms for companies (see the paper by Hannah), and the adoption of new management techniques in France and the UK (the chapter by Boyns). Studying how firms responded to sudden and dramatic change in the geopolitical environment in 1914 has the potential to offer lessons to the managers of today’s multinational firms.






Workshop: Energy governance and sectoral trajectories: France and Japan in evolutionary perspective

1 06 2016



AS: Anyone who will be in Paris on 6 June and who is interested in attending this workshop should contact the organisers on ffj@ehess.fr to reserve a place. There is no fee.
Energy governance and sectoral trajectories: France and Japan in evolutionary perspective
6 June 2016, 9.30-18.00, 190 Avenue de France, 638 (6th floor)

9.30-9.45 Introduction and welcome, Sebastien Lechevalier (EHESS) and Patrick Fridenson (EHESS)

9.50-10.30 Alexandre Rojey (Fondation Tuck)
The energy transition in France and in the world – Objectives and obstacles

10.35-11.15 Yukiko Fukasaku (Independent scholar)
The energy transition in Japan – Challenges and opportunities in comparative context

11.20-12.00 Miyuki Tsuchiya (Université Paris II / Cersa)
Governing energy: the ambiguous link between policy and politic after 3/11. A comparison between France and Japan

Lunch 12.00-13.00

13.00-13.40 Takeo Kikkawa (Tokyo University of Science)
The evolution of Japan’s electricity industry since the 20th century

13.45-14.25 Alain Beltran (CNRS / Université Panthéon-Sorbonne, Paris I)
The history of French electricity since the 20th century
14.30-15.10 Chenxiao Xia (Kyoto University)
Japanese electrification as contrast with the West

Tea break

15.35-16.15 Aleksandra Kobiljski (CNRS / Institut d’Asie Orientale)
Energy workaround: Upgrading coal in Japan’s steel industry

16.20-17.00 Maki Umemura (Cardiff University / FFJ)
Innovation, governance and uncertain shifts in Japan’s photovoltaics industry

17.05-17.45 Christophe Bouneau (Université Bordeaux III Michel de Montaigne)
Governance strategies and innovation dynamics in the French energy sector since the

Interwar period

17.50-18.00 Concluding remarks
Please email ffj@ehess.fr to register attendance.

Historical Research and the Panama Papers

8 04 2016


The Panama Papers are front-page news around the world and nowhere more so than in the UK, where the tax arrangement’s of David Cameron’s family are facing intense public scrutiny (see here, here, and here).  The international furore over the Panama Papers revelations follows many months of debates about international taxation, particularly the taxation of multinational firms such as Google.

At such a time, it is helpful to put contemporary debates about tax havens and cross-border tax strategies into a business-historical perspective. Luckily, a recent paper by Simon Mollan and Kevin Tennent allows us to do that. I’m sharing the details of their paper here in the hopes that it gets the attention from the media and policymakers that it deserves.

International Taxation and Corporate Strategy: Evidence from British Overseas Business, circa 1900-1965


In this article we establish the impact and importance of international taxation on British overseas business circa 1900 to 1965. As the levels of national taxation rose across the twentieth century, different states began to compete for taxable income. This created international double taxation whereby taxation was due twice on the same income or profit. We examine the difficulties that this caused and the responses of firms to this challenge, through the adoption of tax-minimisation strategies, alterations to corporate structure, and the relocation of corporate domicile. We discuss how international taxation was one of the secular changes in the international business environment that contributed to the rise of large-scale multinational enterprises. We conclude by making a call for greater consideration of international taxation in international business history.


Historical Parallels with Current Debates about the Ideology of Silicon Valley

29 02 2016

Henry Ford, 1919


What are the political values of  Silicon Valley’s leaders? How do the values prevailing in Silicon Valley influence the ways in which tech companies are run and the interactions between tech workers and the rest of the population? These questions have recently been debated extensively in the media. Interest in this topic has been increased by stories about conflict between “tech bros” and the homeless in San Francisco (see here),  Y Combinator’s apparent interest in the idea of a minimum income for all citizens (see here), the ongoing fight between Apple and the FBI (see here), controversies about gender (see here) and race in tech companies (see here), and the astonishing data showing that Bernie Sanders has been out-fundraising Hillary Clinton in Silicon Valley (see here).

It has long been clear that few people in Silicon Valley could be placed on a traditional US political spectrum (i.e., one that extends from Bible-thumping patriots on the right to ultra-left social workers on the left). There is certainly a libertarian segment within the Valley, but the reality is even more complex than that.   In my view, perhaps the best journalistic piece about Silicon Valley’s ideology was Timothy B. Lee’s article in Vox earlier this month.  Lee’s paper digests the research on the political views of of Silicon Valley’s elite that has been done by Greg Ferenstein, formerly of the  popular Silicon Valley blog TechCrunch (see here and here).

Lee writes that:

If you’re used to thinking about politics along conventional left-right lines, the Silicon Valley ideology Ferenstein sketches might initially seem like a mass of contradictions — it’s simultaneously anti-regulation and pro-government, libertarian and pro-Obamacare. But Ferenstein argues that these views start to seem more coherent once you understand the unique perspective of technology elites.

In an interview with Lee, Ferenstein claimed that Teddy Roosevelt’s ideas correspond with those of Silicon Valley today. “Theodore Roosevelt. Progressivism — meaning modernism — jumped from the Democrats to the Republicans in the early 20th century. The idea of government efficiency became very popular in Roosevelt’s short-lived Bull Moose Party. Around this time, scientists and engineers started to develop the modern technocratic state.

The word progressive then got co-opted by the labor movement and populist movements a few decades later. But Teddy Roosevelt’s progressivism has been in the American timeline for a while. I think it’s becoming powerful now thanks to the rise of the tech industry.”

I can kinda see why Ferenstein gravitated towards this historical example in the course of trying to make sense of Silicon Valley’s politics. Teddy Roosevelt, the iconoclastic Republican who eventually broke with the GOP in the 1912 presidential election, is an early example of an individual whose views are hard to label. However, I don’t think that Teddy Roosevelt’s militarist, nationalist, and hyper-macho ideology has much in common with the pro-feminist, pro-globalization, and proudly multicultural Silicon Valley of Mark Zuckerberg and Cheryl Sandberg.

As a business historian, what is interesting to me are the parallels between the ongoing fascination with the ideology of Silicon Valley and the amount of ink that was spilled a century ago by people who tried to understand the ideology of Henry Ford, a hard-to-categorize entrepreneur whose innovations disrupted American life. Ford was a vegetarian, a pacifistic, an anti-Semite, and a hater of trade unions and thus combined a variety of left-wing and right-wing positions. His political and managerial ideas fascinated contemporaries, which is why he became a cult figure (think Steve Jobs) who was admired by leaders around the world, including several totalitarian rulers.  I detect a pattern here: whenever a disruptive new industry comes along and changes everyday life, people devote lots of time to trying to determine whether the key entrepreneur or entrepreneurs have a coherent political worldview. (Such efforts may be a foolish intellectual project– I would defy anyone to find coherence in the inconsistent ramblings of Donald Trump).

As a management academic who is interested in entrepreneurial cognition, I’m very interested in another pattern that is revealed here: the people who create new industries tend to be unconventional thinkers whose political views are hard to categorize.



Relevance and Academic Rigour: Why Business Historians Ought to Read Dan Drezner’s Recent WaPo Piece

3 09 2015

Dan Drezner is a professor of international politics at the Fletcher School of Law and Diplomacy at Tufts University. His scholarly works will be familiar to those of us who research international political economy or international business history.  Non-academics will know of Drezner through his Washington Post punditry: Drezner has a knack for presenting academic research in an accessible fashion that allows the average reader of a quality newspaper to make sense of the world. Yesterday, he published a great piece on how political scientists can be academically rigorous and policy-relevant at the same time.

Addressing his remarks at younger political scientists considering their career strategies, he writes:

My own piece of advice on this question is simple.  The best way for academics to maximize their rigor and their relevance is to focus on those areas where the Beltway consensus is at variance with the academic consensus… If there is a gap, that’s fantastic for political scientists. Because that creates a pretty easy-to-write paper that demonstrates the policy consensus, then discusses the academic consensus, and ideally provides data to explain why the gap persists. Often it’s because the policymakers retain untested assumptions, like China’s holdings of U.S. debt giving China foreign policy leverage. But sometimes it might be because policymakers think about the question differently, which in turn can provoke academic reconsideration of the question.  Take, for example, the ongoing debate about the role of reputation in international crises.  The overwhelming consensus in international relations theory used to be that it didn’t matter much at all. Now, there’s a reevaluation going on.

With the possible exception of economics, every social-scientific discipline has its own debates about whether there are trade-offs between academic rigour and accessibility. Accessibility in this context means ensuring that academics are being heard by the group of real-world practitioners served by each discipline. The ultimate consumers of academic knowledge vary, but generally speaking they are policy-makers in the case of political science, working lawyers in the case of legal academics, and businesspeople in the case of management academics.  (Cass Sunstein, the great US law school professor, recently published a paper on this issue as it pertains to legal journals).

Business historians are currently engaged in a debate about the future research trajectory of our scholarly community (see here and here).  Since most business historians work in management schools, we need to give some thought as to the relevance of our research to the ultimate consumers of our academic knowledge. It seems to me that Drezner’s advice about identify gaps between the scholarly consensus and the prevailing ideas among practitioners could be adapted to the needs of the business history community.

I’m currently working with some colleagues on an book about the impact of the First World War on international business. Although the book is aimed primarily at academics, we are striving to ensuring that the manuscript we produce will be readable by and relevant to interested non-academics. I’m working on that book project today and Dan’s piece in the WaPo has intensified my belief that it is really important that we business historians reach out to businesspeople and others who live outside of our ivory towers.

Business History Journals in the Journal Quality Guide of the Association of Business Schools

26 02 2015

Journal Quality Guide of the Association of Business Schools  is used to rank journal articles and is important in the lives of many management academics in the UK and Scandinavia. The new version of the guide was released at 12:01am yesterday. I know of at least one colleague who stayed up past midnight so that they could download the guide immediately after its publication.

ABS Journal Quality Guide

There have been some significant changes in the relative positions of business history journals on page 17 of the ABS guide.

For one thing, some economic-historical journals have appeared on the list of approved historical journals. We can expect more submissions by management scholars to such journals.

Business History a UK based journal, has now been overtaken by the Business History Review from the US. The precise reasons for this change continue to be debated. Business History now ranks as a 3, a rank it shares with Enterprise and Society. The Business History Review has climbed to 4.  The system of rankings has five grades: 4*, 4, 3, 2, and 1.

One other important development in this ranking system is that Management and Organization History has attained a ranking of just 2, whereas prior to yesterday’s release of the new rankings, it had been widely expected to climb to 3.

The guide can’t be downloaded as document that I can forward to you, so I have inserted a screen shot.

The Buzz About Citizen Coke

4 02 2015

I’m going to be co-editing a special issue of the journal Business History with my frequent research collaborator Kirsten Greer. The theme of the special issue is the intersection of business and environmental history: all of the papers in the SI will look at the historical relationship between business and the natural environment.

Because of my work on the special issue, I’ve been encouraged by the fact that Bartow Elmore’s new environmental history of the Coca-Cola company has generated extensive media attention. The degree of attention that has been paid to Citizen Coke is unusual for an academic book, especially one that is the author’s first major publication.

Here is the book’s blurb:

How did Coca-Cola build a global empire by selling a low-price concoction of mostly sugar, water, and caffeine? The easy answer is advertising, but the real formula to Coke’s success was its strategy, from the start, to offload costs and risks onto suppliers, franchisees, and the government. For most of its history the company owned no bottling plants, water sources, cane- or cornfields. A lean operation, it benefited from public goods like cheap municipal water and curbside recycling programs. Its huge appetite for ingredients gave it outsized influence on suppliers and congressional committees. This was Coca-Cola capitalism.


Positive reviews of the book have appeared in the Wall Street Journal, the New York Times, and the Business Standard. [The Business Standard review faults the book on stylistic rather than for content]. A more critical but nevertheless thoughtful review appeared in  Columbia Daily Tribune. The review published in the WSJ is favourable, which is impressive given that Elmore’s book is hardly compatible with the ideological agenda of that newspaper.  The book has also been described in media sources ranging from the Daily Mail, a middlebrow UK newspaper to the Huffington Post to Bloomberg Radio. The book has also been cited in the debates about whether to levy special taxes on sugary foods.

You can listen to Elmore talk about his research here. You can watch him here.

Anyway, the interest that Elmore’s book has generated has convinced us that our Special Issue on Business/Environmental History will be of use to a wide variety of academics.