Modern Business Enterprise as a Capital Saving Innovation

Journal of Economic History, Vol. 47, pp. 473-485, June 1987

13 Pages Posted: 19 Mar 2008

See all articles by Alexander J. Field

Alexander J. Field

Santa Clara University - Leavey School of Business - Economics Department

Abstract

The introduction and diffusion of what Alfred Chandler called modern business enterprise had a profound capital-saving impact on the American economy. Given the availability of the railroad and telegraph, purchasing more managerial labor services paid off principally via increased speed of production and inventory turnover, which spread costs of holding capital over a larger volume of output. This article challenges the consensus that nineteenth- and early twentieth-century technological change in the United States was overwhelmingly labor saving and interprets the factor-saving bias of modern business enterprise as representative rather than anomalous.

Keywords: Communication, industrial organization, technological change, telegraphy

JEL Classification: D23, D24, N71

Suggested Citation

Field, Alexander J., Modern Business Enterprise as a Capital Saving Innovation. Journal of Economic History, Vol. 47, pp. 473-485, June 1987, Available at SSRN: https://ssrn.com/abstract=1109159

Alexander J. Field (Contact Author)

Santa Clara University - Leavey School of Business - Economics Department ( email )

500 El Camino Real
Santa Clara, CA California 95053
United States
408 554 4348 (Phone)
408 554 2331 (Fax)

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