The Company: A Short History of a Revolutionary Idea

Contemporary Review, April, 2004

The Company: A Short History of a Revolutionary Idea. John Micklethwait and Adrian Wooldridge. Weidenfeld & Nicolson. [pounds sterling]14.99. ix 214 pages. ISBN 0-297-84726-0. This short history, by two journalists at The Economist, argues that the limited joint-stock company is not only 'the most important organisation in the world' but 'the basis of the prosperity of the West and the best hope for the future of the rest of the world'.

Often ignored by historians more concerned with political or social history, the history of the company is nevertheless 'an extraordinary tale'. It is capitalism's greatest strength, its advance guard which defeats everything before it. It was preceded by mediaeval corporate bodies and chartered companies. In 1862 the Companies Act made it easier to set them up and they soon transformed the economy as private businesses, handed down from father to son, became incorporated into 'soulless' artificial bodies. The authors argue that companies have become more, not less, ethical and 'caring' with time. They have also become essential to the West's wealth and progress by giving it 'great competitive advantages' when set against individual action or state socialism. The authors show that, far from monopolising economies, the number of companies has spread and competition has increased. The authors begin their story in 3000 B.C. to show how companies developed out of human economics. They carry on at a cracking pace to give readers a good, solid introduction to a vital aspect of our lives, one that is all too easily ignored or misunderstood.