Limits to Scale and Scope: The Failure of a Danish Slaughterhouse Merger in 1890/91

Peter Sørensen and Kurt Pedersen

Business History, 2007, vol. 49, issue 5, 595-624

Abstract: The seminal work of Alfred Chandler was based on observations relating to the so-called second industrial revolution. They concerned the development of the large modern manufacturing company and the paths of that development. This article attempts to apply the framework to a failed Danish slaughterhouse merger in 1890/91 between the established private slaughterhouses and the rising co-operative ones. The article deals with the question of the relevance of Chandler's concepts to the negotiation process and with that of the limits to the explanatory power of the framework. In order to answer these questions, the motives of both parties as well as the negotiation process are investigated in some depth. The analysis provides evidence that both sides made considerable use of arguments in line with Chandler's concepts and serving as a vehicle for creating mutual understanding of the economic rationale behind the merger. The article presents and discusses a number of factors and aspects that stalled the process and eventually caused the failure. These factors are all outside Chandler's universe, the corollary being that while 'economic' arguments unequivocally favoured the merger, 'extra-economic' factors were powerful enough to nullify the economic rationale. Technological and economic arguments were overpowered by political and social ones.

Keywords: Slaughterhouses; Mergers; Negotiations; Motivation Research; Scale and Scope; Co-operative Movement (search for similar items in EconPapers)
Date: 2007
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DOI: 10.1080/00076790701695566

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