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TECH TALK: The Company: John Micklethwait and Adrian Wooldridge

May 4th, 2004 · No Comments

The Company: A Short History of a Revolutionary Idea traces the history of the Company from 3000 BC to now. From the description on the book jacket:

With their trademark authority and wit, Economist editors John Micklethwait and Adrian Wooldridge reveal the company to be one of historys great catalysts, for good and for ill, a mighty engine for sucking in, recombining, and pumping out money, goods, people, and culture to every corner of the globe. What other earthly invention has the power to grow to any size, and to live to any age? What else could have given us both the stock market and the British Empire? The company man, the company town, and company time? Disneyfication and McDonaldsization, to say nothing of Coca-colonialism? Through its many mutations, the company has always incited controversy, and governments have always fought to rein it in. Today, though Marx may spin in his grave and anarchists riot in the streets, the company exercises an unparalleled influence on the globe, and understanding what this creature is and where it comes from has never been a more pressing matter. To the rescue come these acclaimed authors, with a short volume of truly vast range and insight.

The Publishers Weekly adds:

Considering the astounding impact companies have had on every corner of civilization, it’s amazing that the development of the institution has been largely unexamined. Economist editors Micklethwait and Wooldridge present a compact and timely book that deftly sketches the history of the company. They trace its progress from Assyrian partnership agreements through the 16th- and 17th-century European “charter companies” that opened trade with distant parts of the world, to today’s multinationalsMicklethwait and Wooldrige point out that the enormous power wielded by the company is nothing new. Companies were behind the slave trade, opium and imperialism, and the British East India Company ruled the subcontinent with its standing army of native troops, outmanning the British army two to one. By comparison, the modern company is a bastion of restraint and morality. In a short, final chapter on the company’s future, the authors argue against the fear, in antiglobalization circles, that “a handful of giant companies are engaged in a `silent takeover’ of the world.” Indeed, trends point toward large organizations breaking into smaller units. Moreover, the authors argue that for all the change companies have engendered over time, their force has been for an aggregate good.

The authors write in the introduction:

The most important organization in the world is the company: the basis of the prosperity of the West and the best hope for the future of the rest of the world. Indeed, for most of us, the companys only real rival for our time and energy is the one that is taken for granted the familyCompanies have proved enormously powerful not just because they improve productivity, but also because they possess most of the legal rights of a human being, without the attendant disadvantages of biology: they are not condemned to die of old age and they can create progeny pretty much at will.

The company has been one of the Wests great competitive advantages. Of course, the Wests success owes much to the technological prowess and liberal values. But Robert Lowe and William Gladstone [with their Companies Act of the mid-nineteenth century] ushered in an organization that has been uniquely effective in rendering human effort productiveEconomists have elaborated on why such institutions are crucial to economic development. Companies increase the pool of capital available for productive investment. They allow investors to spread their risk by purchasing small and easily marketable shares in various enterprises. And they provide a way of imposing management structures on large organizations.

The history of the Company is a fascinating mirror on our past and present. Even as technology and globalisation expand markets and increase competition, the Company in its various forms remains as resilient as ever.

Tomorrow: Amar Bhide


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