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Business history is at once very old and very young. Objectively, it is as old as town economy in the ancient and medieval periods. By this, I mean that business began in the town, ancient and medieval. Subjectively, it is hardly more than a decade old. That is, as a subject for study, business history is just getting under way. Since this is the case, we may fittingly stop to consider what we are to understand by the subject.Business history is the study of the development of business administration. Roughly, it deals with the historical background of subjects taught in schools of business.Perhaps we may divide the subject, that is, the history of business administration, into two main parts. The first is the history of policy-formulation. We may think that there is little policy in business and has been less in the past. The fault lies in us: there is a long story and an interesting one at this point. Much of the development in policy, conscious or unconscious, is embedded in these five stages—petty capitalism, mercantile capitalism, industrial capitalism, financial capitalism, and national capitalism. Woven into these are many ingredients, but the degree of specialization and control is uppermost in the change of patterns. We shall come back to this subject later.

Over a century ago Henry Shaw climbed the business ladder in St. Louis, and in his later years he did much for the culture of his adopted city. Shaw left behind many records of his career. Those pertaining to his business have been deposited in the Baker Library at Harvard University. The records are voluminous and as yet unused, except in so far as they have been examined for the purpose of the following tentative statement. The collection includes personal accounts, real estate records, family correspondence, and business records, such as waste books, journals, ledgers, invoice books, and bank balances. The collection of letters is particularly significant and valuable, for it deals with many subjects, including importing and exporting, and covers the whole period of Shaw's activity in America.

When this subject was presented to me it appeared quite clearly as a challenge. When I first became interested in the history of business, it was as a study somewhat divorced from the ordinary routine of affairs. I was a student of economic history who had become convinced that the fundamental approach to this subject was along the line of private enterprise. Now I am asked to point out what value there may be in business history to the business man. At the very beginning of this discussion I ought to make a distinction between two types of business history; one, the history of individual business firms; the other, business history in general.

There is a good deal of doubt as to which was the earliest business corporation in America. One view is that a whale-fishing company established in New York City in 1675 was the first, but, although a joint-stock company (a kind of partnership), there is no evidence that it was also a corporation. A second view is that the first was The New London Society United for Trade and Commerce, chartered, apparently, in Connecticut in 1732. The life of these and other colonial concerns was short. Claims might be made for the priority of other colonial companies but our main interest is in existing companies. And this interest does not lie in the age of the concern itself but in the priority of its incorporation.

Although the system of capitalism may be very old, the concept of such a system belongs almost wholly to the last hundred years. I shall deal with only five views, thereby leaving to others such additions as they think fit.

§1. What are public relations? We have social relations, industrial relations, private and even poor relations, but what are public relations? We have them like hives and chilblains, but should we admit the fact? Should we try to get rid of them? Indeed, we have had them for a long time, though the phrase is relatively new and has got into few dictionaries or encyclopedias. But, if these public relations are not really upstart conditions, then perhaps they are respectable and may be spoken of.

Sir Andrew Freeport belonged to the same club as the better-known Sir Roger de Coverley. Sir Andrew was of the moneyed interest and a great sedentary merchant, while Sir Roger was the typical landed gentleman. Probably a hundred persons have heard of the gentleman to one person who knows about the merchant. But the two were alike in being the creation of Joseph Addison's imagination and in coming to light in the show-case window of The Spectator. Moreover, each was intended to be representative of his type and therefore worthy of unusual attention.

Very little is known about the early history of English mercantile venture into the far Eastland. Although some ambitious traders from this island steered their course through the Sound in the fourteenth century, or earlier, and in the fifteenth century seem to have aspired to some degree of common action, it remains true that, previous to the foundation of the Eastland Company in 1579, there was no important body of English merchants organised to trade in the Baltic.

Jamsetji Tata was once a merchant, like his father, but unlike his father he became a great industrialist. Instead of specializing in one huge concern, he spread out to establish many companies of high quality and strategic importance—the foundation of modern Industrial India. It was in part owing to his work that India was able recently to wage a war on the side of the Allies without much help from Britain.