P.J.Wells@OPEN.AC.UK
Fri, 8 Oct 1999 21:18:36 +0100
Looking through some old OPE-L posts, I note that in [OPE-L:988] John Ernst
wrote, with respect to the rate of return on investment
> In the accounting literature the idea
> itself appeared around 1890.
>
Relatedly, in a Capital & Class review article (#35, Summer 1988)
Richard Walker wrote:
"There is no single way to calculate the rate of profit. Indeed,
throughout the 19th century companies computed only profit margins, with
investment charged as part of current operating costs! The method of
determining the rate of profit on invested capital was invented in the
1920s."
Unfortunately editorial errors garbled many of the references in
Walker's article, but for what it is worth the text as printed gives
Chandler's (1962) "Strategy and Structure" (without a page number)
as the source for the last statement quoted.
I've attempted to locate such a reference in Chandler's enormous
tome without success.
Can John, or anyone else on the list, provide some sources for these
various claims about the history of calculating rates of return?
Julian
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