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writing is in future to be legal, and the long recognized custom of the City at length receives the sanction of the Legislature, but only on these express terms, viz. that the payment of the commission and the amount of rate per cent are authorized by the articles and disclosed by the prospectus 1 (Section 8).

Finally comes the question: Will the act achieve its purpose and check fraud? That it will provide work for the courts for years to come is clear. The drafting is not good and the difficulties of interpretation, some of which have been pointed out, are numerous. But criticisms of the act go deeper than that: the provisions as to the register of mortgages, the prospectus and the duties of auditors are all useful and should give some protection to the public, but as it is proverbially easy to drive a coach and four through Acts of Parliament, it should be easy to drive one through or at any rate round some of the chief provisions of this act: there is more than one way of circumventing the "commencement of business" provision, of which much is clearly expected; for instance, the company may in its articles mention some merely trifling sum on which to proceed to allotment, or if the promoters shirk the publicity of this course, they can simply start in a very small way, with seven members, all directors, a small capital of perhaps £100, issue this all nominally to the public, and so secure the Registrar's certificate; they could then at once launch out, increase their capital, say to £500,000 and proceed as at present.

Again, all the restrictions on companies which issue an invitation to the public can at one stroke be rendered futile: many companies domiciled near the Stock Exchange never appeal directly to the public at all; they are "baby creations," owing their birth to strong promoting parents, their shares are dealt in more or less artificially by the parent company, public quotations of the shares appear, and eventually the public rush in and buy: the effect of these clauses will probably be largely to encourage this underground process.

In a word, considering all the time spent upon it it is a pity. that the act achieves so little.

MONTAGUE BARLOW.

1 This clause has already received judicial interpretation. Matabele Gold Reef, Ltd., Sol. Jo., 1901, p. 378.

See Burrows v.

XVIII

TRUST LITERATURE: A SURVEY AND

CRITICISM1

HE industrial changes in the United States during the last

two or three years have called forth inevitably a multitude of writings dealing with the problem of trusts, just as, in the earlier years of the present decade, the condition of our national finances stimulated the discussion of the tariff or the silver question. It is the purpose of this article to present a brief survey of the recent output of trust literature, and then to attempt a critical estimate of the views advanced concerning the most important theoretical problems involved in the study of industrial consolidation.

I

In mere volume, at least, the product of the last few years is noteworthy. Discussion of the monopoly question in the United States seems to have begun early in the seventies, when popular dissatisfaction arose concerning railroad rates and management. Then, for a time, an occasional article in some periodical indicated only a fitful interest in the subject, until early in the eighties the formation of the Diamond Match Company and the Standard Oil Trust caused a livelier discussion of the problem of monopoly. Later in the same decade the appearance of other combinations, as well as a growing interest in railroads and municipal monopolies, caused a marked increase of writings dealing with this subject. An incomplete bibliographical summary shows that fifteen treatises or reports of official investiga

1 From the Quarterly Journal of Economics, Vol. XV, 1901, pp. 167–216.

2 By "trusts" the writer means those great combinations of capital in our manufacturing industries which are commonly called by this name. It is not the purpose of this paper to deal with the literature devoted primarily to the problems presented by the so-called natural monopolies.

tions and over thirty-five noticeable articles in the chief periodicals appeared between 1887 and 1890. For the next six years the output diminished, probably for the reason that the tariff and the money questions were uppermost in the public mind; and only eight books or reports and hardly more than a score of articles. were published during the period. In 1897 and 1898 at least six books or pamphlets and about thirty articles appeared, foreshadowing an increased interest in the problem of monopoly. And, finally, the last two years have given us not less than twenty-eight books, reports, and pamphlets, together with a flood of periodical articles that will reach probably one hundred and fifty titles when the returns for 1900 have all been received. While these figures can claim only substantial accuracy, they will suffice to show that the production of trust literature has kept pace with the process of industrial consolidation.

Any bibliography of these writings, like lists of recently formed trusts, becomes antiquated before it leaves the press, so rapid is the rate of increase. The only serious attempt in this direction is Mr. A. P. C. Griffin's List of Books relating to Trusts, which appeared early last summer. This is of considerable value to the student, but professes to give "only the chief authorities." The list of books and pamphlets is nearly complete, but the reader is surprised to notice that the bibliography refers to Nicholson's short chapter on monopoly value, and does not include the valuable discussion of combinations of capital, contained in Hadley's Economics; while in the references to periodical literature he will often wonder what principles of selection could have been followed.

1 That the small amount of trust literature that appeared between 1890 and 1896 was due to the predominance of other issues may be inferred from the fact that in 1892 and 1896, the two years when presidential elections occurred, our bibliography shows that no books, and only a few articles, appeared. During the period from 1886 to 1900 these (1892 and 1896) were the only years in which no books were published. 2 A List of Books (with References to Periodicals) relating to Trusts. Washington, 1900. [A second edition with additions appeared in 1902. The Quarterly Journal of Economics also contains in its current bibliography a complete list with annotations of both books and periodical literature on this subject. — ED.] The one other recent list of trust writings that deserves mention may be found in the Chautauquan, XXX, 237, 238. For an excellent bibliography of earlier works, see von Halle, Trusts, 338-350 (New York, 1895).

Since the present article must be confined to recent literature, it has seemed best to draw a line somewhat arbitrarily at the year 1897, and to exclude from consideration most of the writings that appeared before that date. Within these limits the author will aim to give detailed references to the books, reports and pamphlets that have come to his attention up to the time of writing. In some cases, however, it will be necessary to refer to works that appeared earlier than 1897. With periodical literature no extended bibliography is necessary in these days, when Poole's Index is available for every reader, so that the citations here given will be confined to the most valuable articles, and to some others that are significant as representing certain shades of opinion.

Passing over certain discussions of the monopoly problem that have appeared in some recent economic treatises and general works of reference,1 which, by the way, may be recommended to those who are beginning the study of this subject, we may divide recent trust literature into eight classes. It is true that any such procedure will be open to the charge of arbitrariness at some points; but, on the other hand, it will avoid so much repetition and bring opposing theories into such clear relief that it may be trusted to commend itself to the reader.

(1) The first of our eight classes comprises the reports of official investigations and the proceedings of conferences called

1 W. P. D. Bliss, Encyclopædia of Social Reform, 888-894, 1346–1348 (New York, 1898); R. H. I. Palgrave, Dictionary of Political Economy, II, 802-807 (London, 1896); C. J. Bullock, Introduction to the Study of Economics, 309-335 (2d edition, New York and Boston, 1900); A. T. Hadley, Economics, 151-173 (New York, 1896).

2 Report and Proceedings of the Joint Committee of the Senate and Assembly appointed to investigate Trusts, Senate Document 60 (Albany and New York, 1897); Industrial Commission, Preliminary Report on Trusts (Washington, 1900); Same, Trusts and Industrial Combinations, Statutes, Decisions and Digest of Corporation Laws; Bulletin of the Department of Labor, No. 29, pp. 661-831, Trusts and Industrial Combinations (Washington, 1900).

The entire report of the United States Industrial Commission has since appeared. Vols. I and XIII are specifically devoted to testimony; Vol. II contains a digest of statutes and decisions; Vol. XVIII is devoted to industrial combinations in Europe; Vol. XIX, pp. 594-685, contains the final report of the commission, with an appended opinion by counsel as to legislation. The Appendix to Vol. XIX, pp. 1120-1128, gives statistics supplementing those in

under the auspices of various organizations.1 The New York investigation of 1897 was mainly a shrewd political move, intended to prove the undying hostility of the Republican party to trusts; but it brought out some interesting information. The trust magnates summoned to testify before the legislative committee suffered from those attacks of loss of memory with which they are usually afflicted upon such occasions; but Mr. Theodore Havemeyer volunteered the statement that he would not care to engage in a business enterprise that did not promise a profit of 15 or 20 per cent. The Industrial Commission was more successful than any previous body of investigators in securing testimony from persons interested in trusts, and its Report contains a careful digest of evidence that adds greatly to its usefulness. The Standard Oil combination seems to have made a most careful and systematic endeavor to clear itself from the many damaging charges that have been brought against its methods; 2 and, if the public still remains unconvinced of the spotless purity of this organization, it will not be due to any lack of sweeping denial and stout asseveration in the testimony of the oil magnates. The most valuable feature of this Report is the investigation, conducted under the direction of Professor Jenks, into the effect of combinations upon prices. This gives us the best available data for a trustworthy conclusion upon a most fundamental question. Nearly as much can be said of the Digest of Corporation Laws contained in the second volume of the Commission's Report. The conclusions and recommendations

Vol. XIII. On the general work of the commission, cf. Quarterly Journal of Economics, XVI, pp. 564-586.

The Twelfth United States Census, Manufactures, Part I, pp. lxxv-lxxxi, specially reports statistics, which are supplemented by Pubs. Amer. Statistical Association, N. S., No. 53, for March, 1901, pp. 1-20. - ED.

1 The Chicago Conference on Trusts (Chicago, 1900); Official Report of the National Anti-Trust Conference (Chicago, 1900); Corporations and Public Welfare, Addresses at the Annual Meeting of the American Academy of Political and Social Science (New York, 1900).

2 This testimony of the oil magnates has been gathered together into a single volume, An Inside View of Trusts (New York, 1899), which has been distributed broadcast, probably for "educational purposes."

A carefully edited and annotated edition of this testimony has recently been issued by the Oil City Derrick. — Ed.

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