Extreme Divorce: the Managerial Revolution in UK Companies before 1914
We present the first broadly representative study for any early twentieth century economy of the extent to which quoted company ownership was already divorced from managerial control. In the 337 largest, independent, UK companies in the Investor's Year Book (those with \pounds 1m or more share capital in 1911) the two million outside shareholders were fewer than today's shareholding population, but they held 97.5% of the shares in the median company and their directors only 2.5%. This indicates a lower level of personal ownership by boards, and of director voting control, in the largest securities market of the early twentieth century than in any of the world.s major securities markets toward the end of that century. Berle, Means, Gordon and others later quantified the USA's delayed (and on this dimension less advanced) managerial "revolution." Their evidence has been widely misinterpreted: some erroneously concluded that America pioneered this aspect of "modernity" and that the "divorce" of ownership from control, globally, was a new and continuing trend.
|Date of creation:||Aug 2011|
|Date of revision:|
|Contact details of provider:|| Postal: Aberconway Building, Colum Drive, CARDIFF, CF10 3EU|
Phone: +44 (0) 29 20874417
Fax: +44 (0) 29 20874419
Web page: http://business.cardiff.ac.uk/research/academic-sections/economics/working-papers
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Bayer, Christian & Burhop, Carsten, 2009.
"Corporate governance and incentive contracts: Historical evidence from a legal reform,"
Explorations in Economic History,
Elsevier, vol. 46(4), pages 464-481, October.
- Christian Bayer & Carsten Burhop, 2008. "Corporate Governance and Incentive Contracts: Historical Evidence from a Legal Reform," Working Paper Series of the Max Planck Institute for Research on Collective Goods 2008_11, Max Planck Institute for Research on Collective Goods.
- Foreman-Peck, James & Millward, Robert, 1994. "Public and Private Ownership of British Industry 1820-1990," OUP Catalogue, Oxford University Press, number 9780198203599, May.
- Gareth Campbell & John D. Turner, 2011. "Substitutes for legal protection: corporate governance and dividends in Victorian Britain," Economic History Review, Economic History Society, vol. 64(2), pages 571-597, 05.
- F. W. Taussig & W. S. Barker, 1925. "American Corporations and Their Executives: A Statistical Inquiry," The Quarterly Journal of Economics, Oxford University Press, vol. 40(1), pages 1-51.
- Quennouelle-Corre, Laure & Cassis, Youssef (ed.), 2011. "Financial Centres and International Capital Flows in the Nineteenth and Twentieth Centuries," OUP Catalogue, Oxford University Press, number 9780199603503, May.
- Clifford G. Holderness & Randall S. Kroszner & Dennis P. Sheehan, 1999. "Were the Good Old Days That Good? Changes in Managerial Stock Ownership Since the Great Depression," Journal of Finance, American Finance Association, vol. 54(2), pages 435-469, 04.
- Michael Weisbach, 2010. "Corporate Governance," NBER Books, National Bureau of Economic Research, Inc, number weis10-1, June.
- R. A. Gordon, 1936. "Stockholdings of Officers and Directors in American Industrial Corporations," The Quarterly Journal of Economics, Oxford University Press, vol. 50(4), pages 622-657.
- Randall K. Morck, 2005. "A History of Corporate Governance around the World: Family Business Groups to Professional Managers," NBER Books, National Bureau of Economic Research, Inc, number morc05-1, June.
- Nick Bloom & John Van Reenen, 2006.
"Measuring and Explaining Management Practices Across Firms and Countries,"
NBER Working Papers
12216, National Bureau of Economic Research, Inc.
- Nicholas Bloom & John Van Reenen, 2007. "Measuring and Explaining Management Practices Across Firms and Countries," The Quarterly Journal of Economics, Oxford University Press, vol. 122(4), pages 1351-1408.
- Bloom, Nicholas & Van Reenen, John, 2006. "Measuring and Explaining Management Practices Across Firms and Countries," CEPR Discussion Papers 5581, C.E.P.R. Discussion Papers.
- Nick Bloom & John Van Reenen, 2006. "Measuring and explaining management practices across firms and countries," LSE Research Online Documents on Economics 733, London School of Economics and Political Science, LSE Library.
- Nick Bloom & John Van Reenen, 2006. "Measuring and Explaining Management Practices Across Firms and Countries," CEP Discussion Papers dp0716, Centre for Economic Performance, LSE.
- Richard N. Langlois, 2010.
"Business Groups and the Natural State,"
2010-29, University of Connecticut, Department of Economics.
- Crafts, Nicholas, 2011.
"British Relative Economic Decline Revisited,"
CEPR Discussion Papers
8384, C.E.P.R. Discussion Papers.
- Shleifer, Andrei & Vishny, Robert W., 1986.
"Large Shareholders and Corporate Control,"
3606237, Harvard University Department of Economics.
- Aldo Musacchio, 2008. "Laws versus Contracts: Shareholder Protections and Ownership Concentration in Brazil, 1890–1950," Business History Review, Harvard Business School, vol. 82(3), pages 445-473, September.
- Rafael La Porta & Florencio Lopez-de-Silane & Andrei Shleifer, 1998.
"Corporate Ownership Around the World,"
NBER Working Papers
6625, National Bureau of Economic Research, Inc.
- Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 1998. "Corporate Ownership Around the World," Harvard Institute of Economic Research Working Papers 1840, Harvard - Institute of Economic Research.
- Faccio, Mara & Lang, Larry H. P., 2002. "The ultimate ownership of Western European corporations," Journal of Financial Economics, Elsevier, vol. 65(3), pages 365-395, September.
- H. T. Warshow, 1924. "The Distribution of Corporate Ownership in the United States," The Quarterly Journal of Economics, Oxford University Press, vol. 39(1), pages 15-38.
- Nick Bloom & Carol Propper & Stephan Seiler & John Van Reenen, 2010. "Management practices in the NHS," CentrePiece - The Magazine for Economic Performance 305, Centre for Economic Performance, LSE.
- Acheson Graeme G. & Hickson Charles R & Turner John D, 2010. "Does Limited Liability Matter? Evidence From Nineteenth-Century British Banking," Review of Law & Economics, De Gruyter, vol. 6(2), pages 247-273, December.
- Eric Hilt, 2007.
"When did Ownership Separate from Control? Corporate Governance in the Early Nineteenth Century,"
NBER Working Papers
13093, National Bureau of Economic Research, Inc.
- Hilt, Eric, 2008. "When did Ownership Separate from Control? Corporate Governance in the Early Nineteenth Century," The Journal of Economic History, Cambridge University Press, vol. 68(03), pages 645-685, September.
- Andrew Godley & Lisa Bud Frierman & Judith Wale, 2007. "Weetman Pearson in Mexico and the Emergence of a British Oil Major, 1901-1919," Economics & Management Discussion Papers em-dp2007-42, Henley Business School, Reading University.
- Rajan, Raghuram G. & Zingales, Luigi, 2003. "The great reversals: the politics of financial development in the twentieth century," Journal of Financial Economics, Elsevier, vol. 69(1), pages 5-50, July.
- William J. Hausman & Mira Wilkins & John L. Neufeld, 2007. "Global Electrification. Multinational Enterprise and International Finance in the History of Light and Power, 1880s-1914," Revue économique, Presses de Sciences-Po, vol. 58(1), pages 173-190.
- Janette Rutterford & David R. Green & Josephine Maltby & Alastair Owens, 2011. "Who comprised the nation of shareholders? Gender and investment in Great Britain, c. 1870–1935," Economic History Review, Economic History Society, vol. 64(1), pages 157-187, February.
- Julian Franks & Colin Mayer & Hannes Wagner, 2006. "The Origins of the German Corporation - Finance, Ownership and Control," Review of Finance, European Finance Association, vol. 10(4), pages 537-585, December.
- David Boughey, 2009. "British overseas railways as free-standing companies, 1900-1915," Business History, Taylor & Francis Journals, vol. 51(3), pages 484-500.
- Cheffins, Brian & Bank, Steven, 2009. "Is Berle and Means Really a Myth?," Business History Review, Cambridge University Press, vol. 83(03), pages 443-474, September.
When requesting a correction, please mention this item's handle: RePEc:cdf:wpaper:2011/21. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Bruce Webb)
If references are entirely missing, you can add them using this form.