Lifting stones: A place for microhistory in accounting research?
Accounting History, May 1999 by Williams, Robert B
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Abstract
This paper discusses a role for microhistory in the writing of accounting histories. It begins by discussing the concept of microhistory and its application to accounting research. The paper argues that microhistories can be of great assistance in writing about accounting during periods such as the industrial revolution. The second part of the paper provides an example of a microhistory by discussing an episode involving an embezzlement at Boulton & Watt's Soho Foundry in Birmingham, England. Knowledge of the incident was gleaned from a small bundle of letters found in the Boulton & Watt archive. It is suggested that this incident forms a microhistory that expands our knowledge of accounting in practice at the Foundry.
. . . the historian's passion for manuscripts and sources is not the desire to confirm facts and dates or to correct occasional points of error in the historical story, but the desire to bring himself [herself] into a genuine relationship with the actual, with all the particularities of chance and change . . .
(Butterfield, 1965, p. 73)
Butterfield speaks for those historians for whom much interest lies in exploring the archive and the building of a relationship with the people whose records it contains. As the search continues a picture begins to assemble in one's mind as to the actions, thoughts and personalities of those whose records are being researched. Occasionally something completely unexpected is found which raises a different set of questions in the mind of the researcher. It is the unlooked for stories that add a more human perspective to archival search. Such stories occupy a space at a micro level in the chain of human experience yet enable the reader to relate to those people whose lives were intertwined with the event that has been revealed. Stories at the micro level, or microhistories, have a place in accounting history because they expand our understanding of the impact of accounting in practice.
Interest in accounting history has expanded greatly over the last few years with an ever increasing number of books. articles and conferences to stimulate further interest (Miller, et al., 1991). It is encouraging to discover that this interest is not constrained by national boundaries nor is it confined to the recent past (Carnegie & Napier, 1996). Interest is further stimulated by the debate between the "old" and the "new" historians, a debate which may not ever be resolved but one which is likely to stimulate a stronger involvement of accountants in the history of their discipline (see, for example, Miller, et al., 1991; Carnegie & Napier, 1996; Funnell, 1996; Boyns & Edwards, 1997; Gaffikin, 1998). The "new" accounting history expands the study of accounting because it is concerned with the world of experience pointing to outcomes in practice. This can be expanded further by the use of microhistory to highlight the experience of ordinary people and perhaps to confront the accepted regime. Microhistory provides a contrast to other histories of accounting which have been concerned with the big picture by concentrating on a tiny part to provide a deeper explanation of accounting in action, including its personal and organisational consequences.
It is the purpose of this paper to discuss the telling of such stories using a microhistorical approach and the benefits that may be brought to the study of accounting history. The second part of the paper will consider one such story as an example of a microhistory.
What is microhistory?
The term microhistory encompasses the study of an incident or individual in depth rather than a group of people or an aggregation of events. Questions may arise concerning the typicality of this individual or event (Sharpe, 1990; Tilly, 1990; Burke, 1992), but with appropriate treatment such a study can be very useful in understanding the practice of accounting in context. There is a danger in concentrating at a micro level in obscuring the wider issues of centres of power. However, in a period such as the industrial revolution, when there appears to have been no "standard" accounting practices, a microhistorical approach can do much to broaden our historical understanding. Sharpe (1990, p.35) points out:
... once a grasp of the society in question has been established, the isolated social event or individual ... can be used to provide a pathway to a deeper understanding of that society.
Microhistory can find its roots in marxism but, because its experimental nature has no body of established orthodoxy, its theoretical underpinnings appear to be eclectic (Levi, 1990). Because of this eclecticism the approach lends itself to use by researchers using a number of theoretical stances. For example:
(a)lthough his own work was mainly concerned with social trends on a grand scale, Michel Foucault encouraged microstudies by his discussion of power not only at the level of the state but also at the level of the factory, the school, the family and the prison (Burke, 1992, p.40).
Microhistorians, of whom Italians Giovanni Levi and Carlo Ginzburg are perhaps at the forefront, have looked at how people behaved in their world (see Ginzburg, 1993, for a history of the term). They see social action as being the result of an individual's decisions, choices, negotiation and manipulation in the face of normative reality (Levi, 1990). Microhistory is based on a microscopic analysis of the archive in the attempt to tell the story of a person or incident. According to Levi (1990, p.94), the work of microhistorians has centered
(o)n the search for a more realistic description of human behaviour, employing an action and conflict model of man's behaviour in the world which recognises his - relative - freedom beyond, though not outside, the constraints of prescriptive and oppressive normative systems.
Microhistory shares a number of similarities with the anthropological technique of "thick description". Developed by Clifford Geertz (see Geertz, 1973), thick description "starts from a set of signifying signs and tries to put them into an intelligible structure" (Levi, 1990, p.98). In other words, rather than trying to impose one law on a series of observations, thick description attempts to interpret these events in their context. Prins (1990, p.l34) described Geertz's thick description as "richly textured accounts which have the depth and the contours to permit substantial anthropological analysis". Microhistory uses a similar approach to produce a richness of explanation and provides a way of teasing out some of the interwoven threads of human life (Stanford, 1994).
The study of history at a micro level should be seen within the broader social context. It is not a negation of a study of the wider issues but a supplement to it (Iggers, 1997, p.17). Microhistory allows a demonstration of the inconsistencies and contradictions of the broader contexts, it shows the incoherence of what at first sight appears to be a coherent whole. Microhistory adds a clarity and a concreteness to the study of the past.
While bearing a number of similarities to the traditional case study approach in the sense that it is a narrative, a microhistory does not set out with the same purpose to identify and describe a problem and its outcomes. In some situations, though, a microhistory may highlight a problem by providing a negative example, an incident which goes against expectations and adds to the quality of the historical story (Ginsburg, 1980). Nevertheless, a microhistory is essentially concerned with the telling of a story and the insights that can be teased from the story come after. These stories are studies of individuals and so it is important to give an impression of their character as well as their actions in order to afford richness to the explanation.
Microhistorians might be criticised for apparently trivialising history by studying insignificant events or being concerned with unimportant people. However, this is a question of typicality requiring each individual historian to justify his or her choice of subject. It is often possible to trace in the life of a modest individual the characteristics of that individual's social level during a specific period (Ginsburg, 1980). On the other hand, the use of an indepth study may be justified on the basis that the story is being told because it is exceptional or it reflects in miniature situations that the historian already knows from other research to be typical (Ginsburg, 1980; Burke, 1992). Similarly the focus on an individual, incident or indeed a business firm may provide a privileged platform from which "to observe the incoherences of large social and cultural systems, the loopholes, the crevices in the structure which allow an individual a little free space, like a plant growing between two rocks" (Burke, 1992, p.42). The following story of William Bennett allows a keyhole through which we can observe an incident that reflects on the practice of accounting in the early nineteenth century as well as to draw attention to the growing problem of crime in the counting house in the early part of the nineteenth century.
Accounting practice is disseminated throughout society and is involved at a number of diverse locations determined by the social context in which the practice operates (Carnegie & Napier, 1996, p.7). Microhistory allows us to explore the reaction of individuals to the control imposed by the practice. It provides the picture of the "other" where people may not act in concert but react individually. Microhistory puts back the humanness into the story by allowing those affected or dispossessed by an accounting practice to speak. It is also a useful technique when studying the use of accounting during periods of change such as the industrial revolution, when each firm devised its own accounting information system in accordance with the precepts and views of its proprietor(s).
Of course, the telling of microhistories depends on there being evidence available in the archive. It is often the small stories that are least preserved because the relevant documents were not thought worthy of retention. However, the records remaining of firms that operated during the industrial revolution and subsequent periods provide a substantial archive. It is hoped that these records will yield a number of stories that will assist in deepening our understanding of the practice of accounting in the past.
On a much smaller scale than a traditional case study, the microhistory is governed by "... the belief that microscopic observation will reveal factors previously unobserved" (Levi, 1990, p.97). In the story recounted below the concept of Boulton and Watt's efficient management practices become open to question. The words of those involved in the actual work shed a different light on these practices.
As an example of the use of microhistory in accounting, Fleischman, et al., (1994, 1995) explore an incident at Boulton and Watt's Soho Foundry, in the early 1800s, involving negotiations for an agreement to set "standard" costs for the casting of steam engine parts. The article examined the record of negotiation in this one firm for evidence of managerialism. On the other hand, Williams (1994) discussed the same incident as an example of chief negotiator James Watt jnr's calculative, rational personality. Both studies draw upon the same incident for different purposes.
What follows is a story revealed by a bundle of letters in the extensive Boulton and Watt archive kept at the Central Library, Birmingham.1 The 50 letters on which the following narrative is based were found in a box of costings, statements and other accounting reports. Their discovery can be likened to the turning over of a stone in a stream or on the sea shore to reveal a myriad of life that was not expected. The story is offered as an example of a microhistory that can bring a richness to the study of accounting's past and is based almost entirely on the voices of the protagonists, as recorded in their letters. The story reveals an embezzlement in an organisation that has traditionally been regarded as a model of efficiency and organisation. This story reveals a strength of microhistory as, in this case, it challenges the accepted view by highlighting a contrary example.
Boulton and Watt's Soho Foundry
Much has been written about the efficiency of the Boulton and Watt organisation, of Birmingham, England, and its accounting process (see, for example, Roll, 1930; Pollard, 1965; Fleischman & Parker, 1991; Fleischman, 1993; Fleischman, et al., 1994, 1995; Williams, 1994, 1997). However, it seems that this picture of efficiency had a number of blemishes. This paper discusses the case of John Bennett, a man who might have been regarded by the management as central to one such blemish. Accounting hides, exposes, provides opportunities, removes opportunities and sets boundaries. For John Bennett accounting meant all of these things for it led to his eventual undoing.
The background
The original partnership of Matthew Boulton2 and James Watt,3 formed in 1775, was established to allow them to act as consulting engineers in the erection of steam engines built to the design of James Watt (Roll, 1930; Dickinson, 1935; Tann, 1981; Law, 1990). The engine developed by Watt was more efficient and economical than the other engines then available. As most of the engine parts were made by subcontractors, Boulton and Watt selected appropriate specialists for particular pieces and, because of a concern for the firm's reputation these subcontractors were selected more on the basis of the quality of their work than cost considerations. However, as time went by, in order to maintain the high quality of the product, more and more parts were made in Boulton's Soho Manufactory, until, by the early 1790s, over 50% of the value of the engines was made by the partners. The nature of the business was changing as well, with customers being more interested in purchasing a complete engine rather than being concerned with the close involvement in its construction that had been necessary to this point.4