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Organizing America

Organizing America: Wealth, Power, and the Origins of Corporate Capitalism

Charles Perrow
Copyright Date: 2002
Pages: 272
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  • Book Info
    Organizing America
    Book Description:

    American society today is shaped not nearly as much by vast open spaces as it is by vast, bureaucratic organizations. Over half the working population toils away at enterprises with 500 or more employees--up from zero percent in 1800. Is this institutional immensity the logical outcome of technological forces in an all-efficient market, as some have argued? In this book, the first organizational history of nineteenth-century America, Yale sociologist Charles Perrow says no. He shows that there was nothing inevitable about the surge in corporate size and power by century's end. Critics railed against the nationalizing of the economy, against corporations' monopoly powers, political subversion, environmental destruction, and "wage slavery." How did a nation committed to individual freedom, family firms, public goods, and decentralized power become transformed in one century?

    Bountiful resources, a mass market, and the industrial revolution gave entrepreneurs broad scope. In Europe, the state and the church kept private organizations small and required consideration of the public good. In America, the courts and business-steeped legislators removed regulatory constraints over the century, centralizing industry and privatizing the railroads. Despite resistance, the corporate form became the model for the next century. Bureaucratic structure spread to government and the nonprofits. Writing in the tradition of Max Weber, Perrow concludes that the driving force of our history is not technology, politics, or culture, but large, bureaucratic organizations.

    Perrow, the author of award-winning books on organizations, employs his witty, trenchant, and graceful style here to maximum effect. Colorful vignettes abound: today's headlines echo past battles for unchecked organizational freedom; socially responsible alternatives that were tried are explored along with the historical contingencies that sent us down one road rather than another. No other book takes the role of organizations in America's development as seriously. The resultant insights presage a new historical genre.

    eISBN: 978-1-4008-2508-0
    Subjects: Sociology, Economics

Table of Contents

  1. Front Matter
    (pp. i-iv)
  2. Table of Contents
    (pp. v-viii)
    (pp. ix-xii)
  4. Chapter 1 INTRODUCTION
    (pp. 1-21)

    This book seeks to tell us how and why it happened that the most important feature of our social landscape is the large organization, public or private. Americans celebrate individualism and entrepreneurship, and some see organizations as getting smaller or more decentralized; so concern with bigness and bureaucracy may have abated. But we should be reminded that today, well over 90 percent of the work force works for someone else—as wage and salary employees—up from 20 percent in 1800; over half of the gainfully employed people in the country work for organizations with 500 or more employees, up...

    (pp. 22-47)

    The nineteenth century opened with an overwhelmingly agricultural base, and with local communities as the organizing principle. Gradually, industry supplanted agriculture, and markets, networks, and then hierarchies supplanted the communal organizing principle. Before we can understand the novelty of hierarchy, that is, large-scale industry, when we encounter it in the chapter on textile mills, we should briefly examine the economic and social changes that made the mills possible.

    Our first conceptual tool is the fairly recent, useful, and academically popular distinction that describes two ways of organizing an economy: markets, where everything is determined by price, and hierarchy, where authority...

    (pp. 48-64)

    In this chapter we shall examine the early history of textile production at the beginning of the nineteenth century, and the two principle examples of large mills, those of Manayunk outside of Philadelphia, and the “Lowell” mills of New England. They prefigure the dominant form of industry that materialized near the end of the century in terms of the form of production, labor management, the role of capital, the occasional evidence of state and federal government help and regulation, and the social costs of this organizational form. Chapter 4 will present the alternative path, the highly networked small textile firms...

    (pp. 65-95)

    As noted earlier, the embargo, wars, and blockades of the early nineteenth century dammed up the money made from mercantilism and relatively free trade in agricultural exports, and the rich colonial merchants, concentrated in Boston, were looking for other investment outlets. (This is the conventional account and will serve us adequately; a much more sophisticated and complicated account can be found in Zerha Gumus-Dawes’s dissertation [2000], which also presents a thorough and novel interpretation of the Slater mills that is consistent with the views I am putting forth but that is much more striking.) The blockades also dammed up the...

    (pp. 96-159)

    We will have a substantial journey through railroad territory, and it will begin rather gently. Our first conductor is Wolfgang Schivelbusch, whose delightfulThe Railway Journey(1986) offers unusual insights and intellectual entertainment. After that short trip, the real work begins when we consider alternative explanations for the privatization of U.S. railroads when other countries were moving toward state regulation, or outright ownership. The alternatives are two economic and two institutional theories, and, of course, organizations and interest groups. But first, some Schivelbuschian technology.

    It’s hard to believe that something as momentous as the steam engine, which brought us railways and...

    (pp. 160-216)

    The railroads were more complex than manufacturing, mining, or maritime enterprises in the nineteenth century, and they quickly evolved administrative structures to handle the complexity; the structures are celebrated as the basis of modern organizations, public and private.

    The large textile mills were complex in many respects. There was a substantial hierarchy: the owners delegated to the superintendent, who delegated to men who headed the repair shops, raw materials handling, and the production steps such as carding, spinning, and dyeing; and these men had foremen of a sort who helped them supervise the machine tenders, runners, teamsters, and so on....

    (pp. 217-228)

    How did it come about that the United States developed an economic system based upon large corporations, privately held, with minimal regulation by the state? Two hundred years ago there were none. Until the 1890s there were only a few large ones, in textiles and railroads and the steel and locomotive industries. Then there was a spurt at the turn of the century; in about five years most of the 200 biggest corporations of the time were formed, and most of these still rule their industries.

    Nothing comparable occurred in Europe. Until the 1950s the corporate structure of the United...

  11. APPENDIX Alternative Theories Where Organizations Are the Dependent Variable
    (pp. 229-236)
  12. NOTES
    (pp. 237-242)
    (pp. 243-250)
  14. INDEX
    (pp. 251-259)