Outside Intervention in Monopolistic Price Warfare: The Case of the “Plug War” and the Union Tobacco Company*

Malcolm R. Burns

Business History Review, 1982, vol. 56, issue 1, 33-53

Abstract: The now-famous merger movement that highlighted the economic cross-currents of the late nineteenth century created no more controversial enterprise than James B. Duke's American Tobacco Company. From the time of its incorporation in 1890, Duke's firm dominated the cigarette business, for which it is so justly renowned, but this controlling position by no means extended into other branches of the industry, particularly the manufacture and marketing of chewing tobacco, or what was known as plug. Yet with almost ineluctable force, Duke and his associates gradually extended their domination to this segment of the business, albeit by a much more uncertain course that included the “plug war” of the mid-1890s and some questionable securities transactions later on. While Dr. Burns takes no side in the still-simmering controversies of the day, in this essay he examines the historical events through which American Tobacco acquired its dominant position in chewing tobacco; equally important, he brings economic theory and new empirical evidence to bear on the contentious issue of predatory pricing as a strategy of monopolization, and from that emerges his surprising conclusion.

Date: 1982
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.cambridge.org/core/product/identifier/ ... type/journal_article link to article abstract page (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cup:buhirw:v:56:y:1982:i:01:p:33-53_05

Access Statistics for this article

More articles in Business History Review from Cambridge University Press Cambridge University Press, UPH, Shaftesbury Road, Cambridge CB2 8BS UK.
Bibliographic data for series maintained by Kirk Stebbing ().