Journal of Economic Literature
Book Reviews
2026-09-01
Petra Moser of Stanford University and NBER reviews “Financing Innovation in the United States, 1870 to the Present” by Naomi R. Lamoreaux, Kenneth L. Sokoloff,. The EconLit Abstract of the reviewed work begins “Eleven papers examine the ways in which innovation has been funded in the United States at different stages of economic development, beginning with the post-Civil War period of the Second Industrial Revolution. Papers discuss financing invention during the Second Industrial Revolution--Cleveland, Ohio, 1870-1920; the organizing and financing of innovative companies in the evolution of the U.S. automobile industry; why finance capitalism and the Second Industrial Revolution arose in the 1890s; funding new industries--a historical perspective on the financing role of the U.S. stock market in the twentieth century; stock market swings and the value of innovation, 1908-29; financing fiber--Corning’s invasion of the telecommunications market; the federal role in financing major innovations--information technology during the postwar period; learning the hard way--IBM and the sources of innovation in early computing; trading knowledge--an exploration of patent protection and other determinants of market transactions in technology and research and development; the governance of new firms--a functional perspective; and real effects of knowledge capital on going public and market valuation. Lamoreaux is Professor in the Departments of Economics and History at the University of California, Los Angeles. Sokoloff is Professor of Economics at the University of California, Los Angeles, and Vice President of the Economic… Index.”