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Early
of
the
Development
Philosophyof
Marketing Thought
An extensive study of archival materials is used to examine the philosophic origins of marketing thought
at two centers of early development, the University of Wisconsin and the Harvard Business School. Evidence suggests that the German Historical school of economics provided much of the philosophic foundation of the discipline.
Method
Journal of Marketing
Vol. 54 (January 1990), 102-113
This content downloaded from 192.152.243.54 on Sun, 24 May 2015 15:32:59 UTC
All use subject to JSTOR Terms and Conditions
is merely
Taylor observed that the series of articles published between 1913 and 1917 all followed a common
pattern.Each study was designed "to picturethe marketing process clearly in order that the true character
of the problems of marketingmight be discovered"
(1941, p. 22). Each study proceededfrom a perceived
marketing problem and the method was always the
same: to observe the facts, to look and see, and then
formulateprinciples and recommendations.
From its inception in 1892, the School of Economics at the University of Wisconsin developed an
institutionalapproachto the study of economics. This
approachincluded an inductive, statistical methodology with a historicalperspectiveand a concernfor the
applicationof knowledge and skills to social ends. Directly and indirectly this approachwas derived from
the German Historical school of economics. Therefore, as a center of the early developmentof marketing thought, the Universityof Wisconsin providedthe
emerging discipline with a distinctive and welldeveloped philosophic foundation.
Indeed, Gay once commented, "If I could only transfer some of Schmoller's qualities into my work as a
teacher I would be happy" (Heaton 1949, p. 61). That
wish apparently was realized. One of Gay's students
in economic history later observed that "he was not
given to vague theorizing . . . hardly ever paused to
generalize" (Cole 1970, p. 34).
Gay credited the German Historical school for
founding the discipline of economic history (1941).
He singled out Wilhelm Roscher as the "original formulator" of the Historical school and cited Karl Knies'
principle of historical relativity as well as the use of
a comparative method as highlights of the school's
contribution to research methodology. He also recognized the intense struggle of the Historical economists, especially Schmoller, with the manner in which
generalizations could be developed from the mass of
economic facts being collected, summarized, and synthesized. The reason for that struggle was the inherent
complexity of economic events. Gay commented (1923,
p. 2) that:
.the longerI live, the moreinclinedI am to agree
with the late ProfessorSchmollerof Berlin that the
world of political, social-psychological,and economicphenomenais a terriblycomplicatedbusiness.
founding of the Business School, Gay further described this conceptionof the laboratorymethodas an
"experimental laboratory studying genetically and
theoreticallythe institutionsand processes of our economic organizationand practically[applying]the new
insights for the continued bettermentof our business
practise" (1927b, p. 400).
Another emphasis in Gay's early thinking about
business trainingwas the role of historicalstudy. Certainly here his trainingunderthe Historicalschool was
influential.The following reflectionswere jotted down
in Gay's personal journal in 1910 shortly after the
School opened.
For most business men do not know enough history
to make analogies, those who do, know enough to
make analogies. . . Some influence of the historical method in spirit. Gaining of perspective, realization of changing character of institutions apparently stable . . . sense of proportion . . . relation
to principles . . . realization of complexity and interrelations and their modification of too rigid and
simple standards of judgement.
Though these notes are only fragments of Gay's thinking on the matter, they indicate the importance he attributed to historical study in a business school. Therein
lay the foundation of the case method at the Harvard
Business School. As Harvard business historian Alfred
Chandler recently observed, "Don't forget, the heart
of this school's curriculum has always been the case
study, and the case study is precisely what a historian
does, what a historian is trained to do" (Kantrow 1986,
p. 82).
Research in Marketing
Gay's training as an economic historian probably in-
of Marketing
The concept of "marketing functions" has been hailed
as one of the most significant theoretical developments of early contemporary marketing thought (Hunt
and Goolsby 1988). Indeed, it has been compared with
the discovery of atomic theory (Converse 1945, p. 19).
There is some consensus that Arch W. Shaw originated the functional approach in his 1912 article, "Some
. . . So it
seemed of significance also to trace through the functions supplementing those of the merchant, which together with his functions made up the compound of
the British economy and then to search for some simple concept by means of which these functions would
fall naturally into definite classifications and their
interdependence disclosed.
Conclusion
During the early part of the twentieth century, when
marketingthought began to emerge in its contempo-
FIGURE 1
The Intellectual Genealogy of Marketing
JENA
(1861-78)
Hildebrand
HALLE
( -1915)
J. Conrad
ROYALSTATS.
BUREAU
HEIDELBERG
(1865-98)
K. Knies
E. Engel
LEIPZIG
(1848-94)
W. Roscher
BERLIN
( -1917)
(1882-1917)
A. Wagner
G. Schmoller
JOHNHOPKINS
UNIVERSITY
R.T.Ely*
-W.A. Scott
H.C.Taylor*
J.R. Commons
H.C.Adams *
F.W.Taussig
E.F.Gay *
MICHIGAN
E.D. Jones *
H1ARVARD
S. Litman*
DavidKinley*
- WISCONSIN
G.M.Fisk*
- S.E. Sparling*
- B. H. Hibbard*
J.E. Hagerty*
ILLINOIS
OHIOSTATE
H.H.MaynardT.N.Beckman-
R.S. Butler
M.B.Hammond*
DT
I . I. m/hrr;in-tnn
ilyItIUI
Ii
P.D.Converse
-P.H.
NEWYORK
Nystrom
P.G. Holden
- T. Macklin
-
W.C.Weidler
L.D.H. Weld
H.E.Agnew
H.H. Comish
F. L. Vaughan
NORTHWESTERN
I
F.E.Clark
P.W.Ivey
* Studied in Germany.
M.T.Copeland
A.W.Shaw
H.R.Tosdal*
M.P.McNair
the philosophic assumptions and ideals we have described. This evidence, combined with the fact that
many of the early marketingscholars actually studied
in Germany under the Historical school or under
Americaneconomists who had studied there and who
had adoptedthatphilosophicposition,wouldbe enough
to suggest that the GermanHistoricalschool provided
a philosophic foundationfor many of our early marketing scholars (Figure 1). In addition, several scholars clearly identified with the field of marketing, as
well as economists with a majorinterestin marketing,
explicitly acknowledged that the German Historical
school influenced their thinking.2
We do not suggest that scholars at these two institutionswere not influenced by other individualsor
ideas not associated with the Historical school. The
Progressive Movement and the relatively large Ger-
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