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Business History: An Expanding Research Area

Business historians study the development of individual firms, or groups of firms, within the context of their economic, social and cultural environment in order to generate knowledge concerning the inter-actions among the firm, the entrepreneur and the institutional setting. The subject is receptive to economics and business economics, as well as to economic history, and it is well suited to the building of bridges among these disciplines.

The academic discipline of business history has its roots in economic history. Like economic history, business history applies an inductive, historical methodology to illuminate the process of change and the course of events in order to increase our understanding of the alternatives faced, and the choices made, by earlier generations (“writing history forwards”). A major aspect of the work is its combination of qualitative and quantitative methods. Here, the research problems chosen and the approach to solving them have their origins in both economics and other social science theories. Another important characteristic is the use of case studies to gain an understanding of the connections between structure and behavior of actors.

As a scholarly discipline, business history is something totally different from the story-telling that produces easily digested, and sometimes smoothed-over celebratory company histories intended to strengthen a firm’s trade-mark. This popular genre has experienced a major upswing in recent years as a firm’s identity and its image have become ever more important immaterial assets. From a scholarly perspective, it is important to emphasize the difference between research and story-telling, and to remember that without serious basic research on a firm’s development and the business environment there is no story to tell – unless it is totally fabricated.

During the last several decades, scholarly business-history research has expanded greatly throughout the world, especially in the more advanced economies in North America, Europe and Asia. A number of new international organizations have been formed and the pre-existing ones have grown and prospered. At the Harvard Business School, business history has long played a major role, with renowned practitioners such as Alfred D. Chandler, Thomas McCraw and, at the present time, Geoffrey Jones. The Business History Review, has been published at Harvard since 1934. The American organization for the discipline, the Business History Conference (BHC), has in recent years experienced a radical renewal under the leadership of economic and technology historians such as Larry Neal, Naomi Lamoreaux, William Hausman and Philip Scranton. This renaissance has found expression in the publication of a new, well received, referred journal, Enterprise and Society: The International Journal of Business.

On the initiative of, among others, Tony Slaven (Glasgow), Geoffrey Jones (Reading), Franco Amatori (Boccini) and Even Lange (BI) a European sister organization, the European Business History Association (EBHA), was established in 1996. Since its inception in 1958, Business History has been the leading European journal in the field. More recently, it has been supplemented by a new referred journal with a financial history bent, the Financial History Review, published since 1994 by the European Association for Banking History.

Another clear tendency within this area of research is a shift from historical description to an approach that is more deliberately theoretical. It goes beyond simply making use of theory to striving for the development of new and better theory. The insight that linking our work to theory increases our knowledge of the circumstances faced by business enterprises, both by adjusting existing theoretical concepts and by contributing to the development of new and better theory, is becoming more and more widespread. Naturally, this applies to not just pure economic, or “main-stream”, theory, but also to theory with a different provenance: dynamic economic theory of Schumpeterian or Dahménian origin (“heterodox theory”) or social and cultural theory formulated, for example, by economic sociologists such as Mark Granovetter and Richard Whitley.

This development necessarily means that only certain aspects of the firm’s behavior are subjected to study in order to give substance to, and illuminate, theoretical concepts. It is therefore becoming increasingly common in business history for functional aspects – deliberately chosen approaches intended to permit the “testing” of theoretical conclusions at the micro level – to be given priority over the comprehensive description of firms. What is essential, however, is that the research maintains a balance between the theoretical and the empirical.

That the perspective is that of the firm is basic, and regardless of the questions posed, the firm is, and will remain, the central object of analysis. An operational definition of business history as a discipline is that it consists of historical research that, at the level of  the firm (and utilizing the firm’s archival material), seeks to answer questions whose nature can vary a great deal. It deals with everything from questions concerning the roles of ownership and leadership, power and influence, principal-agent problems and information asymmetries to those dealing with technology, organizational innovations and the power over work and the work environment. Without a business perspective, however, there is no business history.