ABSTRACT
It is tempting to read the putative organizational advantages of the International Harvester Company (IHC) organization of 1910 as the reasons for the formation of IHC, but such a rear-view mirror approach may lead us to discount from our H[SODQDWLRQVWKHH[LVWLQJRUJDQL]DWLRQRIWKHFRQVWLWXHQW¿UPVIRUPLQJ,+&DQG the tendencies inherent in the competitive scene. In this chapter, I establish what was really new about IHC, why it was formed, and why only in 1902? To do so I interpret the formation of IHC in the context of an account of the competitive situation and tendencies in the North American harvesting-machinery business. In the last two decades of the nineteenth century, both the licensing regime and the dispersed production systems that had characterized its organization gave way to a new regime of corporate production. The explanations for this transformation, though complex, turn on four considerations: the rationalization of the industry on completion of the product cycle; the agglomeration economies achieved in Chicago; changes in production technology; and the superior business organization of the industrial corporation.
