Andrew Carnegie: An Economic Biography

by Samuel Bostaph

This biography of Andrew Carnegie emphasizes the economic dimension of his career in industry. It examines his life as a dynamic innovator during the period when the steel industry rapidly expanded and the United States became a major industrial power. Carnegie rose from a poverty-stricken Scottish childhood to a position of international industrial leadership, philanthropy, and peace advocacy, by means of intelligence, entrepreneurship, ambition, tenacity, guile, and ruthless determination. It is shown that Carnegie excelled as an economic actor. His alertness to expected profit opportunities, and success in coping with the uncertainties of the marketplace, made him a major influence on the growth of many of the most important industries of late-nineteenth century United States and world economies. His contribution to the better coordination of the actions of both demanders and suppliers in those industries by managerial, technological, and institutional innovations is emphasized. It is also argued that those profit-seeking actions and innovations occurred in the context of political policies and social institutions that produced a tremendous mal-investment of resources. This mal-investment was a result of protective tariffs, the stimulus and waste of war, and government subsidization of the railroad industry. Carnegie’s role in this massive diversion of resources from other uses to those from which he personally benefitted is also emphasized. Lastly, Carnegie’s actions in giving away the great personal fortune that he accumulated as he built his business empire are examined and their economic implications assessed.

Genres: Biography

138 pages, Hardcover

First published October 1, 2015

Reviews

[Daniel Moss · Rating 5 out of 5]

I'm not the type that likes to read voluminous historical retellings full of dry facts so this here book was perfect for me.

You get the essentials - Carnegie's early life; his climb up the economic ladder; his business dealings, which includes some cronyism and other not so good things; his sale of the business; and his philanthropic life - without all the lengthy drudgery of many historical biographies.

But what pushes this book over the to is the fantastic economic analysis of Carnegie's entrepreneurial actions. The author begins the book with three main prototypes used by economists to explain entrepreneurship; the Kirznerian one being the one the author uses in his analysis. And then latter in the book, when telling of the historic battles between Carnegie and the laborers, the author explains how the labor theory of value had led the union workers to believe they "owned" and therefore had a "right" to their jobs, and why this is ultimately wrong because of the insights provided by the Mengerian contribution of marginal utility theory of value.

Such a great book. I'll be keeping an eye on this author in hopes that he'll do such works with other figures.

[Lezley · Rating 3 out of 5]

Since my small town has a Carnegie Library, it was interesting to read about who this man was, how he made his money and how he spent it.