This article describes the evolution of IBM's effort to manage its relationships with the U.S. government from the time that Thomas Watson, Jr. became CEO. While the Watson family controlled the firm, the family members served as the main bridges between IBM and the government. This personalized approach began to give way in the 1960s, as the intensity and scope of pressure from the firm's political environment grew beyond the capability of any individual to handle. During the 1970s and 1980s, IBM constructed a managerial hierarchy, with a newly opened Washington office at its center, which could gather more detailed intelligence and execute more sophisticated political strategies. The firm's crisis in the early 1990s provoked a second major restructuring of the interface, as IBM became more of a Washington "special interest." Yet, some traces of the Watson imprint remained, even in the Gerstner era. Tracing IBM's evolution helps us to understand better the broader interactions between U.S. firms and their environments in this period. These interactions entailed adaptation by firms to environmental change but also efforts by firms to exert control over external forces, including public policy.
This article uses a case study to illustrate the dynamics of firm structure and property rights in Brazil during the nineteenth and twentieth centuries. The St. John d'el Rey Mining Company was a British mining company in Brazil. Its experiences demonstrate that, property rights were not under-specified; they were over-specified and varying provisions for rights were mutually inconsistent. Precise laws protected capital investment to such an extent that dissolving partnerships became problematic. At the same time, inheritance laws mandated partible division of personal estates among heirs. The mining company's history demonstrates the opportunities for posthumously emerged heirs, essentially, to claim partnership rights.
Revolutions have important social, political, and economic consequences with which entrepreneurs have to cope to keep their businesses going. This may involve high transaction costs due to the violence that emerges as a result of armed conflicts. In this article we examine the effect that the Mexican Revolution (1910-1920) had on the banking sector and ultimately on bank clients, since revolutionary policies forced most banks to close their doors from 1915 to 1921. By focusing on a major textile firm, the Compañía Industrial Veracruzana, S.A., we observe that companies used nonchartered banks, which spread in the absence of government regulation, and foreign financial institutions, so that daily business operations could continue amidst the revolutionary upheavals.
This study aims at enhancing our understanding of how industrial conditions affect the choice of a firm's ownership structure. The Providence/Attleboro area was a center of jewelry production during the nineteenth century. Because of the differentiated nature of the product, the Providence/Attleboro jewelers needed to promote their products among the wholesalers in distant markets. These geographical and industrial conditions motivated the entrepreneurs to organize partnerships for ameliorating informational asymmetries and for mobilizing the capital required to achieve economies of scale in sales and production.
Welfare capitalism, the management ethos adopted by American business leaders in the early twentieth century, emphasizes the role of business rather than trade unions or government in taking care of its workers. This article focuses on the reasons why the United States Rubber Company (USRC), one of the four largest U.S. rubber manufacturers, promoted welfare capitalism at its rubber plantations on the east coast of Sumatra and Malaya between 1910 and 1942. In addition, this study assesses the development of USRC's system of welfare in the areas of housing, profit sharing, pension plans, health care, and recreation. This article argues that USRC's intention was not to forestall unionization (the intention of U.S.-based companies in adopting welfare capitalism), as union formation in Southeast Asia during that period was very unlikely, but to overcome labor shortages and high turnover rates and to ensure labor stability. With reduced labor costs, the availability of financial resources allowed for technical innovations and R & D, which ultimately would lead to increased productivity.