Competence or omniscience? assessing entrepreneurship in the Victorian and Edwardian British paper industry

Business History Review

Volumn 71, Issue 2, 1997, Pages 230-259

  Magee, Gary B ^a  

^a AUSTRALIAN NATIONAL UNIVERSITY   (Australia)

Author keywords

[No Author keywords available]

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EID: 0031329662     PISSN: 00076805     EISSN: None     Source Type: Journal    
DOI: 10.2307/3116159     Document Type: Article

References (80)

1. For an introduction to this literature, see Sidney Pollard, Britain's Prime and Britain's Decline: The British Economy, 1870-1914 (London, 1989), 1-57.
2. Michael Dintenfass, The Decline of Industrial Britain, 1870-1980 (London, 1992), 12-26; Donald C. Coleman and Christine MacLeod, "Attitudes and New Technologies: British Businessmen, 1800-1950," Economic History Review 39 (Nov. 1986): 588-611.
3. Michael Dintenfass, The Decline of Industrial Britain, 1870-1980 (London, 1992), 12-26; Donald C. Coleman and Christine MacLeod, "Attitudes and New Technologies: British Businessmen, 1800-1950," Economic History Review 39 (Nov. 1986): 588-611.
4. Richard L. Hills, Papermaking in Britain, 1488-1988: A Short History (London, 1988), 119-55. Dard Hunter, Papermaking: The History and Technique of an Ancient Craft (New York, 1978), 309-340, 374-399. For a discussion of factors influencing the supply of rags, see Gary B. Magee, "Technology, Productivity and Performance in the British Paper Industry, 1861-1913" (D.Phil, diss., Univ. of Oxford, 1994), 134-46.
5. Richard L. Hills, Papermaking in Britain, 1488-1988: A Short History (London, 1988), 119-55. Dard Hunter, Papermaking: The History and Technique of an Ancient Craft (New York, 1978), 309-340, 374-399. For a discussion of factors influencing the supply of rags, see Gary B. Magee, "Technology, Productivity and Performance in the British Paper Industry, 1861-1913" (D.Phil, diss., Univ. of Oxford, 1994), 134-46.
6. Richard L. Hills, Papermaking in Britain, 1488-1988: A Short History (London, 1988), 119-55. Dard Hunter, Papermaking: The History and Technique of an Ancient Craft (New York, 1978), 309-340, 374-399. For a discussion of factors influencing the supply of rags, see Gary B. Magee, "Technology, Productivity and Performance in the British Paper Industry, 1861-1913" (D.Phil, diss., Univ. of Oxford, 1994), 134-46.
7. In the American industry wood pulp was commercially introduced in the 1850s and by 1863 newspapers such as the Boston Courier were successfully using it in their newsprint. Esparto, however, was relatively unknown in the United States. John A. Guthrie, The Economics of Pulp and Paper (Pullman, Wa., 1950), 3. For contemporary comments on this divergence, see the Paper Trade Review, 1 May 1863, 101 and 1 Jan. 1864 , 1.
8. In the American industry wood pulp was commercially introduced in the 1850s and by 1863 newspapers such as the Boston Courier were successfully using it in their newsprint. Esparto, however, was relatively unknown in the United States. John A. Guthrie, The Economics of Pulp and Paper (Pullman, Wa., 1950), 3. For contemporary comments on this divergence, see the Paper Trade Review, 1 May 1863, 101 and 1 Jan. 1864 , 1.
9. This is discussed, as is America's choice of raw materials, in Magee, "Technology," 238-49 and 270-1. See also J. Neville Bartlett, "Alexander Pine & Sons of Aberdeen and the Expansion of the British Paper Industry, c.1860-1914," Business History 22 (Jan. 1980): 19.
10. This is discussed, as is America's choice of raw materials, in Magee, "Technology," 238-49 and 270-1. See also J. Neville Bartlett, "Alexander Pine & Sons of Aberdeen and the Expansion of the British Paper Industry, c.1860-1914," Business History 22 (Jan. 1980): 19.
11. Vide Peter H. Lindert and Keith Trace, "Yardsticks for Victorian Entrepreneurs," in Essays on a Mature Economy: Britain after 1840, ed. Donald N. McCloskey (London, 1971), 239-74; Donald N. McCloskey, Economic Maturity and Entrepreneurial Decline (Cambridge, Mass., 1973); Graydon R. Henning and Keith Trace, "Britain and the Motorship: A Case of Delayed Adoption of New Technology," Journal of Economic History 35 (June 1975): 353-85.
12. Vide Peter H. Lindert and Keith Trace, "Yardsticks for Victorian Entrepreneurs," in Essays on a Mature Economy: Britain after 1840, ed. Donald N. McCloskey (London, 1971), 239-74; Donald N. McCloskey, Economic Maturity and Entrepreneurial Decline (Cambridge, Mass., 1973); Graydon R. Henning and Keith Trace, "Britain and the Motorship: A Case of Delayed Adoption of New Technology," Journal of Economic History 35 (June 1975): 353-85.
13. Vide Peter H. Lindert and Keith Trace, "Yardsticks for Victorian Entrepreneurs," in Essays on a Mature Economy: Britain after 1840, ed. Donald N. McCloskey (London, 1971), 239-74; Donald N. McCloskey, Economic Maturity and Entrepreneurial Decline (Cambridge, Mass., 1973); Graydon R. Henning and Keith Trace, "Britain and the Motorship: A Case of Delayed Adoption of New Technology," Journal of Economic History 35 (June 1975): 353-85.
14. Joseph A. Schumpeter, The Theory of Economic Development (Oxford, 1961), 64.
15. William Lazonick, "Competition, Specialization and Industrial Decline," Journal of Economic History 41 (March 1981): 37. For a similar view, see Robert C. Allen, "Entrepreneurship and Technical Progress in the Northeast Coast Pig Iron Industry," Research in Economic History 6 (1981): 35-71.
16. William Lazonick, "Competition, Specialization and Industrial Decline," Journal of Economic History 41 (March 1981): 37. For a similar view, see Robert C. Allen, "Entrepreneurship and Technical Progress in the Northeast Coast Pig Iron Industry," Research in Economic History 6 (1981): 35-71.
17. Allen, "Entrepreneurship," 60.
18. W. Brian Arthur, "Competing Technologies, Increasing Returns, and Lock-in by Historical Events," Economic Journal 99 (March 1989): 116-31; Paul A. David, "Clio and the Economics of QWERTY," American Economic Review 75 (May 1985): 332-37.
19. W. Brian Arthur, "Competing Technologies, Increasing Returns, and Lock-in by Historical Events," Economic Journal 99 (March 1989): 116-31; Paul A. David, "Clio and the Economics of QWERTY," American Economic Review 75 (May 1985): 332-37.
20. Israel Mayer Kirzner, Competition and Entrepreneurship (Chicago, Ill., 1973), 83.
21. Arthur H. Cole, Business Enterprise in a Social Setting (Cambridge, Mass., 1959), 7.
22. Mark Casson, The Entrepreneur: An Economic Theory (Aldershot, 1991), 14.
23. The influence of culture is best discussed in Mark Casson, The Economics of Business Culture: Game Theory, Transaction Costs and Economic Performance (Oxford, 1991) and Mark Casson "Entrepreneurship and Business Culture," in Entrepreneurship, Networks and Modern Business, ed. Jonathan Brown and Mary B. Rose (Manchester, 1993), 30-54. While culture may have a significant role in influencing differences in national, regional or ethnic economic performance, it plays little part in the case studied in this article, which, after all, concerns the choice of one industry, in one country, over a relatively short period.
24. The influence of culture is best discussed in Mark Casson, The Economics of Business Culture: Game Theory, Transaction Costs and Economic Performance (Oxford, 1991) and Mark Casson "Entrepreneurship and Business Culture," in Entrepreneurship, Networks and Modern Business, ed. Jonathan Brown and Mary B. Rose (Manchester, 1993), 30-54. While culture may have a significant role in influencing differences in national, regional or ethnic economic performance, it plays little part in the case studied in this article, which, after all, concerns the choice of one industry, in one country, over a relatively short period.
25. Fritz Machlup, Knowledge and Knowledge Production (Princeton, N.J., 1980), 179; Israel Mayer Kirzner, Discovery, Capitalism, and Distributive Justice (Oxford, 1989), passim.
26. Fritz Machlup, Knowledge and Knowledge Production (Princeton, N.J., 1980), 179; Israel Mayer Kirzner, Discovery, Capitalism, and Distributive Justice (Oxford, 1989), passim.
27. Herbert A. Simon, Models of Bounded Rationality (Cambridge, Mass., 1982).
28. For example, vide C. Knick Harley, "The Shift from Sailing Ships to Steamships, 1850-1890," in Essays, ed., McCloskey, 215-34.
29. Richard R. Nelson and Sidney Winter, An Evolutionary Theory of Economic Change (Cambridge, Mass., 1982). Other recent examples of the evolutionary approach include Fritz Rahmever, "The Evolutionary Approach to Innovation Activity," Journal of Institutional and Theoretical Economics 145 (1989): 275-97 and Marco Iansiti and Tarun Khanna, "Technological Evolution, System Architecture and the Obsolescence of Firm Capabilities," Industrial and Corporate Change 4 (1995): 333-60.
30. Richard R. Nelson and Sidney Winter, An Evolutionary Theory of Economic Change (Cambridge, Mass., 1982). Other recent examples of the evolutionary approach include Fritz Rahmever, "The Evolutionary Approach to Innovation Activity," Journal of Institutional and Theoretical Economics 145 (1989): 275-97 and Marco Iansiti and Tarun Khanna, "Technological Evolution, System Architecture and the Obsolescence of Firm Capabilities," Industrial and Corporate Change 4 (1995): 333-60.
31. Richard R. Nelson and Sidney Winter, An Evolutionary Theory of Economic Change (Cambridge, Mass., 1982). Other recent examples of the evolutionary approach include Fritz Rahmever, "The Evolutionary Approach to Innovation Activity," Journal of Institutional and Theoretical Economics 145 (1989): 275-97 and Marco Iansiti and Tarun Khanna, "Technological Evolution, System Architecture and the Obsolescence of Firm Capabilities," Industrial and Corporate Change 4 (1995): 333-60.
32. Given the ever-evolving nature of entrepreneurial decision making, its assessment cannot be adequately captured by a single, simple decision rule. This is obviously an inconvenience to the researcher, but is unavoidable if we are to have a more realistic way of judging the quality of entrepreneurship.
33. Report from the Select Committee on Paper (Export Duty on Rags), Parliamentary Papers 1861, XI [hereafter cited as S.C. on Paper], 270, 342, 344, 304; C.D.M. Ketelbey, Tullis Russell: The History of R. Tullis and Company and Tullis Russell & Co. Ltd., 1809-1959 (Markinch, Fife, 1967), 107.
34. Report from the Select Committee on Paper (Export Duty on Rags), Parliamentary Papers 1861, XI [hereafter cited as S.C. on Paper], 270, 342, 344, 304; C.D.M. Ketelbey, Tullis Russell: The History of R. Tullis and Company and Tullis Russell & Co. Ltd., 1809-1959 (Markinch, Fife, 1967), 107.
35. S.C. on Paper, 292.
36. Patent Office, Patents for Invention: Abridgements of Specifications, Class 96, Paper and Paper-making (London, 1855-1885).
37. Donald C. Coleman, The British Paper Industry: A Study in Industrial Growth (Oxford, 1958), 196.
38. Patent Office, Patents for Invention.
39. See S.C. on Paper, 270.
40. Paper Trade Review, 1 Jan. 1863, 42, and 1 March 1864, 73.
41. For full details of this comparison and its calculation, see Magee, "Technology," 153-63.
42. See Paper Trade Review, 1 July 1863, 145, and 1 Sept. 1863, 177.
43. Magee, "Technology", 161.
44. t-K where R is the annual gain from using wood instead of esparto, r the discount rate, K the cost of the machinery, and t time.
45. Paper Trade Review, 1 Oct. 1863, 200.
46. A. Dykes Spicer, The Paper Trade (London, 1907), appendices V and IX; E. Henry Phelps Brown and S. Andrew Ozga, "Economic Growth and the Price Level," Economic Journal 65 (March 1955): 2.
47. A. Dykes Spicer, The Paper Trade (London, 1907), appendices V and IX; E. Henry Phelps Brown and S. Andrew Ozga, ∞Economic Growth and the Price Level,∞ Economic Journal 65 (March 1955): 2.
48. S.C. on Paper, 300. Also see Evans, Chater, Bruce, and other's comments on 293-4, 296, 305, 341, and passim.
49. S.C. on Paper, 303. American manufacturers of the time also showed the same initial resistance to non-rag fibres. David C. Smith, History of Papermaking in the United States, 1691-1969 (New York, 1970), 133; Victor Selden Clark, History of Manufactures in the United States (New York, 1929), II, 485, and Magee, "Technology", 238-43.
50. S.C. on Paper, 303. American manufacturers of the time also showed the same initial resistance to non-rag fibres. David C. Smith, History of Papermaking in the United States, 1691-1969 (New York, 1970), 133; Victor Selden Clark, History of Manufactures in the United States (New York, 1929), II, 485, and Magee, "Technology", 238-43.
51. S.C. on Paper, 303. American manufacturers of the time also showed the same initial resistance to non-rag fibres. David C. Smith, History of Papermaking in the United States, 1691-1969 (New York, 1970), 133; Victor Selden Clark, History of Manufactures in the United States (New York, 1929), II, 485, and Magee, "Technology", 238-43.
52. Lorna Weatherill, One Hundred Years of Papermaking: An Illustrated History of the Guard Bridge Paper Company Limited, 1873-1973 (Edinburgh, 1974), 20, Also see Hills, Papermaking in Britain, 138, 147-8.
53. Lorna Weatherill, One Hundred Years of Papermaking: An Illustrated History of the Guard Bridge Paper Company Limited, 1873-1973 (Edinburgh, 1974), 20, Also see Hills, Papermaking in Britain, 138, 147-8.
54. Paper Mill Directory, The Art of Papermaking: A Guide to the Theory and Practice of the Manufacture of Paper (London, 1876), 100.
55. Paper Mill Directory, Art of Papermaking, 6.
56. S.C. on Paper, 345.
57. For example, Lou Calder, The First Hundred Years: Perkins-Goodwin Company (New York, 1946), 19.
58. S.C. on Paper, 341.
59. S.C. on Paper, 270.
60. S.C. on Paper, 283. This is, of course, not a precise figure. Coleman, British Paper Industry, 214, does in fact suggest a less important role for imported rags than we do. As we know rag did steadily lose its share and as we are, after all, more interested in the progress of the other materials in this period, any possible underestimation of rag usage implicit in the calculations is unlikely to be sufficient to significantly alter the nature of the picture given by Figure 1.
61. For a description of Routledge's process for treating esparto, see Hills, Papermaking in Britain, 139-40.
62. Between 1878-1888, rag prices fell on average from £16 to £11. Spicer, Paper Trade, 32-3.
63. Hills, Papermaking in Britain, 150-3; Hunter, Papermaking, 391-3, 575.
64. Hills, Papermaking in Britain, 150-3; Hunter, Papermaking, 391-3, 575.
65. Paper Maker's Circular, 10 Dec. 1886, 400.
66. Like rag, esparto did not totally disappear, as the material found a niche for itself in the high quality printing and writing paper sector of the trade. In 1938, 316,000 tons of it were still imported into Britain for such purposes. Hills, Papermaking in Britain, 141-3.
67. Board of Trade Journal, Jan. 1891, X, no. 54, 59. Some other references to wood pulp in the same journal are found in Jan. 1893, XIV, no. 18, 89; May 1895, XVIV, no. 106, 580; and Nov. 1895, XIX, no. 112, 580. Similar articles can be found in all the other trade publications. See, for example, Paper Trade Review (1 Feb. 1889): 1; Paper Maker's Circular (10 Dec. 1883); 272, (11 May and 10 June 1885): 131-4 and 167-70, and (10 March 1887): 100.
68. Board of Trade Journal, Jan. 1891, X, no. 54, 59. Some other references to wood pulp in the same journal are found in Jan. 1893, XIV, no. 18, 89; May 1895, XVIV, no. 106, 580; and Nov. 1895, XIX, no. 112, 580. Similar articles can be found in all the other trade publications. See, for example, Paper Trade Review (1 Feb. 1889): 1; Paper Maker's Circular (10 Dec. 1883); 272, (11 May and 10 June 1885): 131-4 and 167-70, and (10 March 1887): 100.
69. A type of quality writing paper where a size is applied after the paper web has been dried by immersing the paper in a mixture of alum and warm gelatine. This reduces the rate at which the paper absorbs water. Hills, Papermaking in Britain, 223.
70. A more detailed account of the firm's history is given in Magee, "Technology," 167-76.
71. GD 311/1/8: 30 Aug. 1864, Alexander Cowan and Sons Limited Collection, Scottish Records Office [hereafter cited as Cowan Collection].
72. GD 311/1/8: 5 March 1867, Cowan Collection.
73. GD 311/1/9: 16 July 1867, Cowan Collection.
74. GD 311/179: 20 Aug. 1867, Cowan Collection.
75. GD 311/1/10: 30 Oct. 1882, Cowan Collection.
76. GD 311/1/10: 1 Jan. 1883, Cowan Collection.
77. Keith Pavitt, "Patent Statistics as Indicators of Innovative Activities: Possibilities and Problems," Scientometrics 7 (Jan. 1985): 77-99.
78. See, for example, R.W. Sindall, Bamboo for Papermaking (London, 1909), 7. Fear of a depletion of wood supplies were even appearing in the mid-1880s. Paper Maker's Circular (10 Dec. 1886): 400.
79. See, for example, R.W. Sindall, Bamboo for Papermaking (London, 1909), 7. Fear of a depletion of wood supplies were even appearing in the mid-1880s. Paper Maker's Circular (10 Dec. 1886): 400.
80. Board of Trade Journal, Sept. 1895, XIX, no. 110, 333.