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.

Elmore

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.


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Bartow Elmore on Citizen Coke

21 12 2014

Bartow Elmore is an assistant professor of U.S. history at the University of Alabama and a regular attendee of the Business History Conference. He does research that straddles the line between business and environmental history.  He has published an article in Fortune that gives readers the main highlights of his new book Citizen Coke: The Making of Coca-Cola Capitalism. Essentially, he argues that Coca-Cola’s business model involves externalising as many of the environmental costs associated with production as possible.

I call this money-making approach Coca-Cola capitalism. Coke followed this path throughout the 20th century. It involved getting others, whether it was government-owned water works or vertically integrated sugar refineries, to invest in the production and distribution systems needed to turn the “Real Thing” into a real thing. What made Coke great, in other words, was not really what it did, but what it didn’t do. It proved incredibly adept at getting independent businesses and local governments to bear the majority of the costs of producing and distributing its products.

It sounds like the classic story of socialised costs and privatized profits, which is tale that is familiar from countless industries. I’m really looking forward to reading this book and to seeing how Elmore deals with the following questions:

To what extent was Coca-Cola’s competitive advantage due to a greater willingness/ability to shift environmental costs to others than its rivals?

Why did the legal and political systems of the countries Coca-Cola operates in allow the firm to get away with the arrangements Elmore views as bad for overall social welfare?

To what extent did the weakening of common-law remedies for environmental externalities in the United States encourage Coca-Cola to pursue this strategy?


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