Abstract
The chapter introduces the approach of business history developed and applied by Werner Plumpe and many other German business historians. It distinguishes three different types of business history: anniversary publications, business history publications, and theoretically based business history, the core and relevant publications for the evolution of the academic field. Concentrating mainly on the third type, the chapter asks for the peculiarities of the historical evolution of businesses and argues for a stronger consideration of Schumpeter’s works on organizational as well as technological innovation of corporations. Schumpeter’s description of the entrepreneur does in fact refer to the problem of decision-making in corporations and should be re-formulated in the light of more recent contributions to decision theory. For Plumpe, the problem of decision-making and of organizing the process of generating decisions forms the nucleus of business history.
First Publication: Werner Plumpe, Die Unwahrscheinlichkeit des Jubiläums—oder: warum Unternehmen nur historisch erklärt werden können, in: Jahrbuch für Wirtschaftsgeschichte 2003/1, 143–56, ©2003, Walter De Gruyter GmbH.
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Notes
- 1.
As a somewhat alarming example of Zeitgeisthaftigkeit (the quality of being stuck in the mind-set of the time), see the article Die Manager der Nazis that Norbert Frei published in: Der Spiegel 20/2001, 180–92. The tone of the Nuremberg indictment against industrial chemicals giant IG Farben lends itself readily to generalization, and it is one who rehearses not simply in a spirit of admission but also as moral stricture. Similarly typical is the anthology of twentieth-century-industrial careers edited by Paul Erker and Toni Pierenkemper. Amid much that is worth reading, the Introduction to their volume positively bristles with Zeitgeist, reflecting as it does a mental continuity of entrepreneurial stance from the National Socialist period until the late 1960s. Paul Erker/Toni Pierenkemper, Deutsche Unternehmer zwischen Kriegswirtschaft und Wiederaufbau. Studien zur Erfahrungsbildung von Industrie-Eliten, Munich 1999. Not until a ‘new start’ transformed social awareness in the years after 1968 were the old attitudes finally laid to rest.
- 2.
Niklas Luhmann, Die Realität der Massenmedien, 2nd enlarged edition, Opladen 1996.
- 3.
Toni Pierenkemper, Was kann eine moderne Unternehmensgeschichte leisten? Und was sollte sie tunlichst vermeiden?, in: Zeitschrift für Unternehmensgeschichte (ZUG) 44 (1999), 15–31. Toni Pierenkemper, Sechs Thesen zum gegenwärtigen Stand der deutschen Unternehmensgeschichtsschreibung. Eine Erwiderung auf Manfred Pohl, in: ZUG 45 (2000), 157–66.
- 4.
Peter Borscheid, Der ökonomische Kern der Unternehmensgeschichte, in: ZUG 46 (2001), 5–10.
- 5.
Manfred Pohl, Zwischen Weihrauch und Wissenschaft? Zum Standort der modernen Unternehmensgeschichte. Eine Replik auf Toni Pierenkemper, in: ZUG 44 (1999), 150–63.
- 6.
Borscheid, Der ökonomische Kern, (cf. note 4).
- 7.
For initial thoughts on this, see Ulrich Pfister/Werner Plumpe, Plädoyer für eine theoriegestützte Geschichte von Unternehmen und Unternehmern, in: Westfälische Forschungen 50 (2000), 1–21.
- 8.
Here one might note in the margin that such an approach will also guard against over-hasty political and moral judgments. These have lost none of their bite in academic texts—for two reasons. On the one hand we know, at least since Max Weber’s 1917 lecture ‘Wissenschaft als Beruf’, that criteria of moral judgment have no foundation in science. On the other, such verdicts invariably spark a scientific ‘civil war’ in that the question of the correct ruling very soon turns into a question of the character and opinions of the authors concerned (see Niklas Luhmann’s 1989 speech ‘Paradigm lost’). I presume it is hardly necessary to cite instances.
- 9.
Which is basically what Hermann Lübbe is saying in Geschichtsbegriff und Geschichtsinteresse. Analytik und Pragmatik, Basel 1977.
- 10.
For publication, the importance of the appropriate commitment on the part of the entrepreneur is overstated almost as a matter of principle; he or she may possess political influence or buy some, but this will never in itself guarantee business success.
- 11.
For a full treatment, see Toni Pierenkemper, Unternehmensgeschichte: Eine Einführung in ihre Methoden und Ergebnisse, Stuttgart 2000.
- 12.
The relevant debate about corporate history, notably in connection with lengthy discussions of the works of Alfred Chandler, has also been more intense in the Anglophone world. For the present state of such discussions, see Naomi L. Lamoreaux/Daniel M. G. Ralff/Peter Temin, New economic approaches to the study of business history, in: Business and Economic History 26 (1997), 57–79.
- 13.
To that extent the approach advocated in a recent ZUG article is not without problems. The authors say virtually nothing definite about the actual decision-making dynamics of the firm with regard to its environmental relations. See Florian Triebel/Jürgen Seidl, Ein Analyserahmen für das Fach Unternehmensgeschichte, in: ZUG 46 (2001), 11–26.
- 14.
A good survey of the literature will be found in Malcolm H. Dunn, Die Unternehmung als ein soziales System. Ein sozialwissenschaftlicher Beitrag zur Neuen Mikroökonomie, Berlin 1998. See also Jochen Schumann, Grundzüge der mikroökonomischen Theorie, 6th, revised and expanded edition, Berlin 1992, 405–68.
- 15.
Matthias Erlei/Martin Leschke/Dirk Sauerland, Neue Institutionenökonomik, Stuttgart 1999.
- 16.
Norbert Reuter, Der Institutionalismus. Geschichte und Theorie der evolutionären Ökonomie, Marburg 1994.
- 17.
A collection of the principal essays published since the 1930s may be found in Ronald H. Coase, The firm, the market, and the law, Chicago 1990.
- 18.
The fundamental source is Herbert A. Simon, Models of man, London 1957.
- 19.
Herbert A. Simon, Homo rationalis, Frankfurt a.M. 1993.
- 20.
R. M. Cyert/H. G. March, A behavioral theory of the firm, Englewood Cliffs 1963.
- 21.
Heinz Sauermann/Reinhard Selten, Anspruchsanpassungstheorie der Unternehmen, in: Zeitschrift für die gesamte Staatswissenschaft 118 (1962), 577–97.
- 22.
Oliver E. Williamson, The economic institutions of capitalism, New York 1985. See also Oliver E. Williamson, The modern corporation: Origins, evolution, attributes, in: Journal of Economic Literature 19 (1981), 1537–68.
- 23.
‘Behavioral opportunism’ describes the unilateral use of rules whose general reliability remains unquestioned.
- 24.
Among other sources, see Oliver Hart/John Moore, Property rights and the nature of the firm, in: Journal of Political Economy 98 (1990), 1119–58.
- 25.
In this connection, see Michael C. Jensen/William H. Meckling, Managerial behavior, agency costs and ownership structure, in: Journal of financial economics 3 (1973), 305–60.
- 26.
In this connection, see also the fundamental study by Richard R. Nelson/Sidney G. Winter, Firm and industry response to changed market conditions: An evolutionary approach, in: Economic inquiry 17 (1980), 179–202. For a recent critique of the ‘static’ approach put forward by the new institutional economics school, see S. R. H. Jones, Transaction costs and the theory of the firm: The scope and limitations of the New Institutional Approach, in: Business History 39 (1997), 9–25.
- 27.
Joseph A. Schumpeter, The theory of economic development: An inquiry into profits, capital, credit, interest, and the business cycle, New Jersey 1983, (originally published in German in 1911 as Theorie der wirtschaftlichen Entwicklung. Eine Untersuchung über Unternehmergewinn, Kapital, Kredit, Zins und den Konjunkturzyklus). Present reference to German version, Berlin 1987 (7th edition), esp. 124 ff.
- 28.
My criticism is not aimed at evolutionary economics as such. Here it relates solely to the fact that the firm is not looked at as potentially problematic. On the subject of evolutionary economics generally, see also Ulrich Witt, Reflections on the present state of evolutionary economic theory, in: Geoffrey M. Hodgson/Ernesto Screpanti (eds), Rethinking economics. Markets, technology and economic evolution, Aldershot 1991, 83–102.
- 29.
Schumann, Grundzüge (see note 14), 442 ff.
- 30.
The notion that a company’s transaction costs tend to rise was already clearly formulated by Coase, who took as his starting-point ‘that the costs of coordinating activities within a company rise disproportionately in relation to the number of transactions performed, since the ability of management in this respect has decreasing borderline yields and the likelihood of wrong decisions by the company and inefficient deployment of factors goes up’, Schumann, Grundzüge (cf. note 14), 435. See also E. Bössmann, Unternehmungen, Märkte, Transaktionskosten: Die Koordination ökonomischer Aktivitäten, in: Wirtschaftswissenschaftliches Studium (WiSt) 12 (1983), 105–11.
- 31.
For a thorough study of autopoiesis and the apparent paradox of simultaneous openness and closedness, see Niklas Luhmann, Soziale Systeme. Grundzüge einer allgemeinen Theorie, Frankfurt a.M. 1984.
- 32.
The relationship was expressed in different words by Werner Sombart back in the 1920s; see Werner Sombart, Der moderne Kapitalismus, in: Bernhard Harms (ed.), Kapital und Kapitalismus. Vorlesungen gehalten in der deutschen Vereinigung für Staatswissenschaftliche Fortbildung. Berlin 1931, Vol. 1, 89 f.
- 33.
Confusing organizational compulsions with individual motives is not redeemed even by asserting that certain individual motivations (that of management, for instance) characterize it. We know neither the motives of management nor whether they are ‘representative’ of an organization as a whole.
- 34.
The changing nature of market forms is crucial in this connection, because in the protected conditions of national markets quite different circumstances prevail than in connection with ‘globalization’. The latter entails a change in the configuration of potential existential threats and hence a shift in what is expected of the organization, which then needs to calculate different uncertainty ranges into its mode of behavior.
- 35.
A well-known instance is what happened to IG Farben’s plan to synthesize petrol. At first this seemed to make excellent business sense, but subsequent oil finds in Texas in the late 1920s robbed the project of its economic foundations. See below (in the text).
- 36.
On its own, the dispute about future corporate policy and investment can be seen as a classic example of the contingent nature of the repercussions of internal corporate decision-making that in no way complies with rationally prescribed solutions. See Wolfram Fischer, Dezentralisation oder Zentralisation—kollegiale oder autoritäre Führung?, in: Norbert Horn/Jürgen Kocka (eds), Recht und Entwicklung der Großunternehmen im 19. und frühen 20. Jahrhundert. Wirtschafts-, sozial- und rechtshistorische Untersuchungen zur Industrialisierung in Deutschland, Frankreich, England und den USA (Kritische Studien zur Geschichtswissenschaft, Vol. 40), Göttingen 1979; Helmut Tammen, Die IG Farbenindustrie AG (1925–1933). Ein Chemiekonzern in der Weimarer Republik, Berlin 1978. For a general view, see Gottfried Plumpe, Die IG Farbenindustrie AG. Wirtschaft, Technik, Politik 1904–1945, Berlin 1990.
- 37.
See Peter Hayes, The ‘Gleichschaltung’ of IG Farben, Ann Arbor 1982.
- 38.
The structure of the German banking landscape, for instance, offers a typical instance of decision-induced path dependences, the changing nature of which over recent decades brought substantial additional costs. However, the outcome of those changes is still wholly unpredictable. See Lothar Gall et al., Die Deutsche Bank 1871–1996 (also published in English), Munich 1996.
- 39.
See Hans Mommsen/Manfred Grieger, Das Volkswagenwerk und seine Arbeiter im Dritten Reich, Düsseldorf 1996, in which the authors show impressively what effects enforced survivals can have under extreme circumstances.
- 40.
Examples of enforced survivals in wartime economy can be found in Petra Bräutigam, Mittelständische Unternehmen im Nationalsozialismus: wirtschaftliche Entwicklungen und soziale Verhaltensweisen in der Schuh- und Lederindustrie Baden-Württembergs, Munich 1997 or in Astrid Gehrig, Nationalsozialistische Rüstungspolitik und unternehmerischer Entscheidungsspielraum. Vergleichende Fallstudien zur württembergischen Maschinenindustrie, Munich 1996.
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Plumpe, W. (2016). The Improbability of the Jubilee: Or Why the Only Way to Shed Light on a Firm Is through Its History. In: German Economic and Business History in the 19th and 20th Centuries. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-137-51860-6_4
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