LalocracioIn thinking about the current contested state of global capitalism, and what to do about it, much can be learned from the debates I heard at the recent Harvard Business School conference, Seeking the Unconventional in Forging Histories of Capitalism, which assembled a stellar and diverse cast of historians, management researchers, and others.
As co-organizer of the event with HBS Professor Tarun Khanna and Harvard-Newcomen Fellow Sudev J. Sheth, I was thrilled as participants explored, tested, and celebrated unconventional ideas, research topics and methodologies. Too often scholarly–and other–critiques of capitalism and big business resort to stereotypes and generalizations, sweeping the good, the bad, and the ugly into an amorphous single entity. Engaging seriously with the past can be liberating and provide a refreshing lens to think about the future.
Mao and fake capitalists
The opening session went to the heart of current debates about fake news and authenticity. Mao’s China cultivated a small group of so-called Red Capitalists who were fake capitalists, but used to show off to foreign visitors as if they were real. In the early 20th century, the expected and natural color of American food became standardized through the use of dyes and adroit consumer marketing. The natural color of food became a fake color; and the fake became real as people came to expect it to be a “natural” color. Dominant narratives in history can also be significantly myopic, sometimes accidently, as sources are written in languages not easily understood. The globalization of the world in the 19th century, as a third speaker discussed, has been written from a Euro-centric perspective. In reality, the bazaars and local merchants of the India Ocean were co-creators of a global trading world along with Western firms.
“Mao’s China cultivated a small group of so-called Red Capitalists who were fake capitalists, but used to show off to foreign visitors as if they were real.”
Does any of this matter now? I took away that the answer is probably yes. Stories might be fake, but they can become real. And there are real consequences. When Deng Xiaoping began to plan the re-opening of China in 1978, he assembled five geriatric fake capitalists in a big meeting to get it all started. The close reading of historical documents, and unconventional ways of analyzing them, can help us see the past and the present with fresh eyes.
Outlaw capitalism
As the day progressed, we heard other stories about the challenges of understanding what is really going on. Mao’s China not only had fake capitalists, but tens of thousands of illicit capitalists engaged in forbidden exchanges. Police records and other, unconventional, records are being used by one speaker to uncover the scale of their activities, and argue that basically China already had an entrepreneurial class ready and waiting when Deng began opening China. Another speaker, on what he termed “outlaw capitalism,” explored how early modern pirates in Asia can tell you as much about mercantile capitalism of the era as the activity of ostensibly regular merchants. He applied the same logic to hackers and data capitalists of today. In 1970s California, capitalist enterprises became entangled with feminist movements, public policies, and identity politics. In San Jose, many women were elected to political positions. As state governments cut funding for schools, they turned to Silicon Valley firms for philanthropy, unintentionally handing control of public goods to unelected white men.
Much of the story of the growth and impact of global capitalism has focused on the West. The capitalism which is now under so much criticism is American capitalism, or more specifically a form of American capitalism which became dominant from the 1980s.
The School’s extensive Creating Emerging Markets project is designed to help correct this bias by recovering the lives of key business leaders across Africa, Asia, and Latin America. We learned of different sorts of capitalism in a session devoted to this endeavor to create a whole new archive of data. Indian business leaders were inspired by Gandhi’s notion of trusteeship. African business leaders prioritized the use of capitalism to lift up Africans, and the African continent. Family values, not share prices, were what drove the big Latin American business houses. These projects together show the much broader role of business in society than simply making profits.
Unconventional techniques
Fresh thinking requires fresh methodologies, and a session was devoted to unconventional research techniques. One speaker explored thousands of contracts in early modern China to show how tree plantation was managed through market mechanisms rather than state dictates as in the West. Another speaker used appointment diaries of prominent political figures as a new way to highlight networks and relationships, and how they change over time. A third paper used address books to trace the longevity of firms in 20th century Turkey, shedding new light and hard evidence on the government’s policies to favor Muslim business over those of Armenian, Greek, and Jewish minorities. These new data sets and analytical techniques, enabled by new tools in computational data science, have potential to broaden and deepen our understanding of how capitalism has evolved and its impact.
“These projects together show the much broader role of business in society than simply making profits.”
A final session proposed novel takes on capitalism by looking at unconventional individuals. Reverting to the argument that English-speaking capitalism, often embodied by Adam Smith, is but one type, the French mercantilist Jean-Baptiste Colbert was re-invented during the conference as a pioneer of market capitalism. Through a number of court cases and contention over the serial litigant Clarence Venner in the early 20th century United States, we learned about the complex relationships between private and public parties. Private parties sometimes acted as public regulators, and public regulations relied on private parties to enforce and advance certain regulatory policies. Meanwhile, the unlikely influence on ecological and socially responsible business of the Austrian philosopher Rudolf Steiner, who in 1913 founded Anthroposophy—a “science of the spirit,” provides further evidence on alternative capitalisms to the American capitalism of today. Steiner and his followers created a new way of doing business based on distinctive (some would say highly odd) beliefs which sought to restore harmony between humans, and especially between the natural and spiritual worlds.
Business history at Harvard Business School has been unconventional since it began in the 1920s. After all, it was unconventional of the Dean Wallace B. Donham to create the new discipline at a business school. In our contested world of today, there has never been a better time to promote unconventional thinking which can take us out of our comfort zones, challenge us to think about the contested nature of authenticity, and offer a path out of the intellectual straightjackets which academics, practitioners and others all too often find comfort in.