The teaching duo of Edward S. Mason and Paul M. Sweezy taught a popular course on the theories of socialism at Harvard as well as the course of today’s posting that provides the syllabus and reading assignment for a one semester course on corporations. Also two problem sets discussed in the recitation sections were found filed with the course outline and are transcribed below.
This course was a prerequisite for Mason’s second term course “Industrial Organization and Control”.
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Course Description, 1940-41
Economics 61a 1hf. The Corporation and its Regulation. Half-course (first half-year). Tu., Th., Sat., at 11. Professor Mason and Dr. P. M. Sweezy.
This course deals with the development of the modern business corporation, and corporate accounting, and financial practices. Particular attention will be paid to the internal organization of the corporations including the relation between security owners and management. State and Federal regulation of incorporation and security issue and the nature of the government corporation will form a part of the course.
Source: Division of History, Government, and Economics Containing an Announcement for 1940-41, Official Register of Harvard University, Vol. XXXVII, No. 51 (August 15, 1940), pp. 56-57.
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Enrollment 1939-40
[Economics] 61a 1hf. Professor Mason and Dr. P. M. Sweezy.—The Corporation and its Regulation.
Total 169: 2 Graduates, 51 Seniors, 84 Juniors, 19 Sophomores, 2 Freshmen, 11 Other.
Source: Report of the President of Harvard College, 1939-40, p. 99.
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Economics 61a
1939-40
Outline
Date | Lecture Subjects | Reading |
Sept. 27-30 | Introduction History of the Corporation |
C. C. Abbott, “The Rise of the Business Corporation” [Ann Arbor, 1936] |
Oct. 1-7 | History of the Corporation Capital and Capitalization Financial Problems |
Dewing I: 2-4 |
Oct. 8-14 | Valuation and Depreciation Valuation and Depreciation Section |
Dewing III:1-4, IV:3-5 |
Oct. 15-21 | Corporate Reorganization Case Studies in Corporate Reorganization |
Dewing IV:7-8, VI: 1-2 |
Oct. 22-28 | Ownership, Management, and Control Case studies of individual companies Section |
Berle and Means I:1-6, II: 5-6 |
Oct. 29-Nov. 4 | The Economics of the Firm Size and Efficiency Examination |
Clark, “Economics of Overhead Costs” Chs. 4,6; [Henry] Dennison, Management in [Recent Economic Changes in the United States, New York, 1929], Vol. 2 |
Nov. 5-11 | Management Problems Corporation and the Theory of Profits Section |
Knight “Risk, Uncertainty, and Profit” Chs. 7, 9, 12 |
Nov. 12-18 | The Corporation and Private Property Case Study Corporate Concentration of Economic Control |
Berle and Means IV:1-4; Structure of the American Economy, Chs. 7,9; Appendices 9-13 |
Nov. 20-26 | The Stock Market Sale of New Securities Ownership of Securities |
20th Century Fund “The Security Markets” Chs. VIII, IX, XI, XIII |
Nov. 27-Dec. 3 | Ownership of Securities Holiday Section Meeting |
“The Security Markets” Chs. III, IV, VI |
Dec. 4-10 | Institutional Investment Development of Corporation Law Development of Corporation Law |
Berle and Means, Book II |
Dec. 11-17 | The Securities Act and the Securities and Exchange Commission The Government Corporation |
4th Annual Report of the Securities and Exchange Commission J. H. Thurston “Government Proprietary Corporations” Chs. I, VI |
Economics 61a
Section Meeting
Oct. 13-14, 1939
- Discuss the significant differences between the modes of raising capital of the following firms, as indicated by their capital stock and funded debt:
- United States Steel Corporation (1934)
Common Stock |
$870,000,000 |
Preferred Stock |
360,000,000 |
Surplus |
520,000,000 |
Bonds guaranteed by U.S.S.C. |
50,000,000 |
Not guaranteed |
40,000,000 |
Purchase Money Obligations |
16,000,000 |
$1,856,000,000 |
- International Harvester Company (1937)
Common Stock |
$170,000,000 |
Preferred stock |
82,000,000 |
Surplus |
75,000,000 |
$327,000,000 |
- Associated Gas and Electric Company (1937)
Capital Stock and Surplus |
$148,000,000 |
Minority Interest |
94,000,000 |
Convertible Bonds |
49,000,000 |
Other Funded Debt |
598,000,000 |
$889,000,000 |
- New York Central Railroad Company (1937)
Capital Stock |
$562,000,000 |
Surplus |
204,000,000 |
Equipment Obligations |
31,000,000 |
Mortgage Bonds |
513,000,000 |
Debenture Bonds |
5,500,000 |
Collateral Trust Bonds |
90,000,000 |
$1,405,500,000 |
- Discuss the influence of dividend policy on the interests of the following types of shareholder:
- Common stock.
- Non-participating, non-cumulative preferred.
- Non-participating, cumulative preferred.
- Participating, non-cumulative preferred.
- Participating, cumulative preferred.
- Debenture bond.
- Until about 1930 the courts generally held that non-cumulative preferred shareholders had a claim against the company for dividends equal to the stated percentage in their shares provided such dividends had been earned but not declared. Does this mean, in effect, that no company could really issue non-cumulative preferred stock prior to 1930? Can you see any reason why the courts should take such a stand?
Source: Harvard University Archives. Syllabi, course outlines and reading lists in economics, 1895-2003 (HUC 8522.2.1). Box 2, Folder “1939-40 (2 of 2)”.
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Reading Period Assignment
Jan. 4-17, 1940
Economics 61a: Read one of the following:
- Kennedy, E. D., Dividends to Pay.
- Flynn, J. T., Security Speculation
- Gordon, Lincoln, The Public Corporation in Great Britain.
- Crum, W. L., Corporate Size and Earning Power.
Source: Harvard University Archives. Syllabi, course outlines and reading lists in economics, 1895-2003 (HUC 8522.2.1). Box 2, Folder “1939-40 (1 of 2)”.
Image Source: Edward S. Mason and Paul Sweezy from Harvard College Class Album 1937.