Reframing of US economic, institutional and intellectual history of the organisational transformation, from entrepreneurial to managerial capitalism, brought forth what became a dominant narrative, that administration coordination by trained professional managers is essential to the efficient running of organisation both public and private.  In the pre-war decades America’s large multi-national corporations like General Motors were seen in Europe as the model for how big business should be run, as some people believed, would soon be ruling the world. Alhtough that of course did not happen, many of those once-admired corporates have not survived the destruction that swept through US business since the 1980s.

Globalisation and technological changes and the emergence of new investor has change the face of American capitalism. The emergence of Apple, Microsoft, General Electric, and Du Pond organised in a different way from their predecessors, more reliant on intangible assets such as knowhow and intellectual property.

Richard Langlois, professor of economics at the University of Connecticut, reveals how the railway companies, larger and more complex than the standard owner managed firm, recruited salaries specialists to run their operations, followed by tycoons like Rockefeller Carnegie and the rest who built huge empires in industries such as steel and oil aided by well-trained engineers and managers.

By early 20th century, these control of corporations shifted away from the founder or their descendants and ownership passed into the hands of small investors, giving managers in the head office greater freedom to run businesses as they saw fit. Then began the transition from a capitalist to a managerial society. Companies like GM and Ford squeezed out their smaller competitors, and some of them used their financial strength to diversify by takeover into other industries. Harold Geneen, at ITT, converter a telecommunication company into a conglomerate. Corporate raiders like T Boone Pickens, in 1985, took aim at over-diversified companies, often breaking them up and generating handsome gains for shareholders. Venture capitalist and private equity became the catalyst fro restructuring process.

The government impeding industrial changes using antitrust legislation used not to promote competition but to preserve competitors, reflecting a distrust of big business that has been a long-running stand of American politics.

Langlois, argues that managerialism rose to prominence not because of inherent superiority but because of its contingent value in young and rapidly developing American economy and claims the internet, was the backbone of successful industrial policy “ a product of decentralised and lightly governed collective invention among a large number of private and state actors, none of whom planned or foresaw the outcome of their joint activities”.

The structures of managerialism solidified their dominance only because the century’s great catastrophes of war, depression and war again superseded markets, scrambled relative prices, and weakened market-supporting institutions, which reemerged to shift advantage toward entrepreneurial and market-driven modes of organisation.

The Corporation and the Twentieth Century: The History of American Business Enterprise by Richard N Langlois, Princeton $50/ £42, 816 pages.