The Corporation and the Twentieth Century

100. Manne (1965).

101. Donaldson (1993, p. 81).

102. Baker and Smith (1998, p. 19). Shortly before merging with Raytheon in 2019, United

Technologies would spin off as separate companies both Otis and its Carrier air-conditioning business. Dana Mattioli and Thomas Gryta, “United Tech to Break Itself into Three Companies,” Wall Street Journal, November 26, 2018.

103. Pickens (1987, p. 136).

104. Blair and Litan (1990, pp. 47–48).

105. Baker and Smith (1998, p. 22).

106. Bhagat, Shleifer, and Vishny (1990); Bhidé (1990); Shleifer and Vishny (1991).

650 Notes to Chapter 9

107. Jensen (1988, p. 21). Jensen estimates that over the period 1976–1990, value to target shareholders was $650 billion.

108. Rohatyn (1986, p. 31).

109. Lavoie (1984).

110. Bhidé (1989); Jensen (1988); Palepu (1990); Shleifer and Vishny (1988).

111. Jensen (1991).

112. Davis et al. (2014).

113. Drucker (1986, pp. 14–15).

114. Jensen (1988); Roe (1994).

115. Baker and Smith (1998); Kaufman and Englander (1993).

116. Auerbach (1990, p. 91).

117. Baker (1992).

118. Burrough and Helyar (2008).

119. That shipping company was called Sea-Land, which we will meet presently.

120. “RJR Nabisco Chief Considering Buy-Out of Concern for $17.6 Billion, or $75 a Share,”

Wall Street Journal, October 21, 1988.

121. Jensen (1991, p. 14). Lou Gerstner, the American Express executive whom KKR installed

as CEO, is on record as believing that KKR paid too much for the company (Gerstner 2002, p. 5). 122. Jensen (1991, pp. 22–23).

123. Miriam Gottfried, “KKR Has Quietly Built an Investment-Banking Contender,” Wall

Street Journal, September 25, 2019.

124. Branson (1980, p. 183).

125. Alder, Lagakos, and Ohanian (2014).

126. Irwin (2017, p. 534).

127. Branson (1980, p. 196).

128. Irwin (2017, p. 506).

129. Irwin (2017, p. 511).

130. Branson (1980, p. 186); Irwin (2017, pp. 565–69).

131. Jensen (1993, p. 841).

132. Feyrer, Sacerdote, and Stern (2007).

133. Warren (2001, p. 215).

134. Vatter (1963, p. 154); Tiffany (1984).

135. Tiffany (1984, p. 411).

136. O’Brien (1992).

137. Calder (1993, pp. 113–14).

138. Yamawaki (1988, p. 294).

139. Calder (1993, pp. 183–95); Yonekura (1994, pp. 198–213).

140. Ankli and Sommer (1996).

141. Rogers (2009, p. 136). For example, producers of beer and soft drinks transitioned com-

pletely from steel to aluminum for their containers. 142. Iverson (1997, p. 6).

143. Crandall (1981, pp. 20–23).

144. DeAngelo and DeAngelo (1991, p. 4).

145. Warren (2001, pp. 309–39).

Notes to Chapter 9 651

146. Nohria, Dyer and Dalzell (2002, pp. 172–77).

147. Warren (2008, p. 248).

148. United States v. Bethlehem Steel Corporation, 168 F. Supp. 576 (S.D.N.Y. 1958).

149. Barnett and Crandall (2002, p. 130).

150. Warren (2008, p. 228).

151. Warren (2008, p. 238).

152. Warren (2008, p. 262).

153. Barnett and Crandall (1986).

154. Warren (2008, p. 250).

155. Barnes and Tyler (2010).

156. Ghemawat (1994, pp. 689–90).

157. Christensen (2015, pp. 90–91).

158. Ghemawat (1994); Iverson (1997).

159. Barnett and Crandall (1986, pp. 20–21).

160. Barnes and Tyler (2010, p. 17).

161. White (1982, p. 418).

162. Hyde (2003, p. 181).

163. Ingrassia (2010, p. 36).

164. Halberstam (1972, p. 292).

165. Libecap (1989).

166. Copp (1976); Nash (1968). The oil-depletion allowance, in force since the 1920s, permit-

ted oil producers to deduct up to 27.5 percent of gross revenues, on the theory (or pretext) that the oil in the ground was a capital good that was “depleting.” Many have argued that this favored vertically integrated firms by allowing them to “squeeze” independents; but the counterargu- ments are persuasive that absent an ability to fudge transfer prices, there was little differential benefit to vertically integrated firms (Levin 1981).

167. Irwin (2017, p. 517).

168. Hammes and Wills (2005, p. 501).

169. Jimmy Carter, “The Moral Equivalent of War,” Time, Monday, Oct. 18, 1982. 170. Ingrassia (2010, p. 55).

171. Rubenstein (1992, pp. 155–57).

172. Hammes and Wills (2005, p. 501).

173. Irwin (2017, p. 572).

174. Train and Winston (2007), Tables 1 and 2.

175. Ingrassia (2010, p. 80).

176. Halberstam (1986, p. 557).

177. Hyde (2003, pp. 220, 240).

178. Levin (1995, pp. 43–47).

179. Rubenstein (1992, p. 203).

180. Reich and Donahue (1985, pp. 91–92).

181. Ingrassia (2010, p. 80).

182. Cusumano (1985, pp. 19–20).

183. Cusumano (1985, pp. 28–57); Halberstam (1986).

184. Halberstam (1986, p. 307).

652 Notes to Chapter 9

185. Sakiya (1982).

186. Cusumano (1985, pp. 58–72).

187. Cusumano (1985, pp. 137–43); Halberstam (1986).

188. Cohen (1987).

189. Womack, Jones and Roos (1990, pp. 54–55).

190. Helper and Henderson (2014).

191. Cusumano (1985, pp. 262–80).

192. Womack, Jones and Roos (1990).

193. Cusumano (1985, p. 331).

194. Halberstam (1986, p. 312).

195. MacDuffie and Helper (2007, p. 424).

196. Flugge (1929, p. 163); Murray and Schwartz (2019, pp. 50–55).

197. Alexander (1961).

198. It is often claimed that the automakers adopted arm’s-length sourcing as a way of exercising