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Mercantilism, management accounting or managerialism? Cost accounting in early nineteenth-century US textile mills

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  • Thomas Tyson

Abstract

In a recent critique of early US cost accounting practice, Hoskin and Macve (1996) conclude that Lawrence Manufacturing Company's 1848 cost accounting reports were purely mercantile and provided no managerial utility. Despite finding mathematically exact allocations and unit costs for different cloth grades and production locations, Hoskin and Macve argue that mill accounting was neither modern nor managerial, descriptors they limit to the exercise of disciplinary control over labour through standard costs and variances. They conclude that scholars have overstated the managerial utility of cost accounting during the first half of the nineteenth century. In rebuttal, this paper garners archival evidence to show that cost accounting was used by early nineteenth-century US textile owner/managers in a variety of decision-making, management control and problem-solving scenarios. Specific attention was directed to evidence in forms other than accounting ledgers and summary statements, i.e. letters, memoranda, cost reports, etc., which might reveal if and how accounting was used to address issues such as make-or-buy, product pricing, wage setting, site selection and asset expansion and acquisition. While the absence of standard costs and variances affirms Hoskin and Macve's narrow interpretation of managerialism, evidence presented refutes their wider, more substantive claim that cost accounting served only mercantile purposes at the US mills.

Suggested Citation

  • Thomas Tyson, 1998. "Mercantilism, management accounting or managerialism? Cost accounting in early nineteenth-century US textile mills," Accounting History Review, Taylor & Francis Journals, vol. 8(2), pages 211-229.
  • Handle: RePEc:taf:acbsfi:v:8:y:1998:i:2:p:211-229
    DOI: 10.1080/095852098330521
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    References listed on IDEAS

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    1. Hoskin, Keith W. & Macve, Richard H., 1988. "The genesis of accountability: The west point connections," Accounting, Organizations and Society, Elsevier, vol. 13(1), pages 37-73, January.
    2. Miller, Peter & Napier, Christopher, 1993. "Genealogies of calculation," Accounting, Organizations and Society, Elsevier, vol. 18(7-8), pages 631-647.
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    Cited by:

    1. Malcolm Anderson, 1999. "Accounting History Publications 1998," Accounting History Review, Taylor & Francis Journals, vol. 9(3), pages 375-384.
    2. Glenn Vent & Ronald Milne, 2000. "Accounting practices of the St. Joseph Lead Company: 1864-1900," Accounting History Review, Taylor & Francis Journals, vol. 10(2), pages 97-128.
    3. Martin Quinn & Desmond Gibney, 2018. "Accounting at an Irish maltster – the accounting practices of Bennetts of Ballinacurra in the 1920s and 1930s," Accounting History Review, Taylor & Francis Journals, vol. 28(1-2), pages 61-84, May.
    4. Richard K. Fleischman & David Oldroyd & Thomas N. Tyson, 2011. "The efficacy/inefficacy of accounting in controlling labour during the transition from slavery in the United States and British West Indies," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 24(6), pages 751-780, August.
    5. Quattrone, Paolo, 2004. "Accounting for God: accounting and accountability practices in the Society of Jesus (Italy, XVI-XVII centuries)," Accounting, Organizations and Society, Elsevier, vol. 29(7), pages 647-683, October.
    6. Vijaya Murthy & Jim Rooney, 2018. "The Role of Management Accounting in Ancient India: Evidence from the Arthasastra," Journal of Business Ethics, Springer, vol. 152(2), pages 323-341, October.

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