The way in which business men “translate” economic policy into business policy has never been studied systematically, but the subject is worth investigating. This problem first came to my attention in connection with some research in the field of economic history, and I have recently run across a case which merits description though broader conclusions cannot be drawn at this time.

In the history of man there have been many occupations but none more important than war, business, and religion. We shall consider at length the course of the first two, without neglecting the third, during the period of the last 600 years.

In December the Business Historical Society presented to its members a new book, WEAF: A Pioneer in Commercial Broadcasting, by William P. Banning. This volume is concerned with the beginnings of the radio industry, which has become so very important both economically and culturally in the brief span of about a quarter-century. The experimentation involved led to the creation of the American way of commercial broadcasting.

Someone may say that he has not yet learned what a business history is and therefore that he is in no position to consider the types of business history that may exist. Perhaps, however, it may help in grasping the essentials of business history if these types are set forth.

Right at the beginning of this effort we should note that we have in mind the history of a business unit — a business man, a firm, or a company. To be sure, there are other approaches to business history, namely, the history of a function, such as production or marketing, the history of a whole industry, such as meat-packing or cotton textiles, and, of course, the general history of business.

Any person who could devise measures by which the fluctuations in modern business could be eliminated, or materially reduced, would undoubtedly carve for himself a deep niche in the Hall of Fame. Both business men and observers of economic phenomena have noted that recurring crises seem almost as inevitable as the setting of the sun, if not so regular. If the severity of crises could be mitigated, solvent firms might not fail as often as they do, and the erratic economic course of man might not be subject to such violent ups and downs.

It was the topography of a trout stream which first set my thoughts in the direction of local business history, and then led to broader fields of research. Mill ponds and crumbling masonry are more or less traditional parts of the New England landscape. I should be willing to pass them over with the customary casual notice, were it not that increasing familiarity with some of Massachusetts' “backwoods” country began to reveal what looked like a remarkable pattern of local development. There was a positively idyllic stage of research when, with fly rod in hand, I examined the dams and sluiceways on half a dozen local streams, and pondered the archeological evidences of antique industry. Many questions came to mind. Too early for a place in the Industrial Revolution, too numerous to fit neatly into the colonial-agrarian pattern — what system of economy did these ruins represent ? Might they not stand apart, a system of their own, drawing from the earlier and nourishing the later? The phase of inquiry succeeding superficial curiosity led to local libraries and county records. It seemed wise to concentrate initial research efforts in one area, and on one representative watercourse.

The accompanying picture of a pawnbroker's shop and sign was taken in Boston in 1946. The sign of the three balls is a common sight in the poorer sections of many American cities, and its meaning is always the same: the balls signify that within the shop loans may be obtained on the pledge of personal property. This type of loan is centuries old: it existed in ancient Greece at the time of Pericles and in ancient Rome at the time of Augustus. Professional money-lenders, either Jews or Lombards, reappeared in the Middle Ages, and their activities elicited the opposition of the Church and the hatred of the populace. Attempts to get rid of the Jewish or Lombard pawnbrokers were repeatedly made, but the result was always the same: the need of consumers for credit accommodation was so great that the money-lenders were usually recalled after a short while.

The history of the part played by the sedentary merchant in financing the business of his time is a long and important story. We know that merchants served as suppliers of capital to others as far back as in twelfth-century Genoa. Through the centuries mercantile families and sedentary merchants, as they grew old and rich, tended to specialize in lending money for business purposes. This contribution of the sedentary merchant was important in the economic life of many countries over centuries of time.

Man has developed three types of explanation of phenomena. The oldest is deistic or theological. From earliest times man has explained happenings and situations by looking to outside powers, at first to many gods and later to one all-powerful deity. We still say, “God wills it,” “Thy will be done,” and “the Lord giveth and the Lord taketh away.” But, not later than the flowering of the Greek mind, a second type arose, namely, the metaphysical or philosophical. According to this type of explanation, there are great forces at work, such as the pursuit of liberty, economic determinism, and the unconscious urge of the reproduction of our kind. Such explanations or solutions are easy, economical, and satisfying to their devotees. They tend to reflect the working of the mind, however, rather than mirror the world that is. Reacting from the subjective, modern scholars have insisted upon a more objective approach. Impatient with deduction, they have proclaimed induction as the more fruitful method of discovering and dealing with phenomena, The result is positivism or science. For over a hundred years, workers have been allured by the new prospects, and in the group have been both Comte and Pareto: let us discover facts and classify them and avoid all metaphysical dogma.

The development in the nineteenth century of new manufactured products which were made in large quantities and under increasing competition as the decades passed brought great changes in marketing organization, in the financing of marketing, and in selling methods. Since there was no adequate experience, no precedent, to go by, the changes that came were largely improvised and experimental. Some of the problems that arose and attempts at solving them are well illustrated by what happened in the marketing of sewing machines.

Observation of the operation of a number of large companies has convinced Professors Clough and Cochran, the two most active members of the New York Committee on Business Records, that in most companies no official is satisfactorily taking care of the problems of record management.

Professor Gras has asked me to talk today on government regulation in the field of Finance. When he first mentioned the matter it seemed to me a most stimulating suggestion. The more I considered it, however, the more difficult the assignment appeared. The more I thought about it the more the subject seemed to be made up of a large number of topics relatively unrelated to each other. Management of insurance companies can hardly be treated in the same paragraph with the divorce of security affiliates from commercial banks, and competitive bidding has little in common with measures designed to protect bank depositors. While many of the particular segments of this subject possess great interest in their own right and deserve careful individual treatment, they are for the most part technical and cannot be dealt with adequately in the time at my disposal. Moreover, they are in many instances special subjects. By this I mean that they have wholly different backgrounds, that their internal logics are dissimilar, and that the kinds of knowledge needed to see each in its proper perspective are quite disassociated. The problem is to knit this compartmentalized subject together so as, on the one hand, to see it as a whole, and on the other hand, to avoid somewhat empty generalities.