Limited Partnership in New York,

¶ … Limited Partnership in New York, 1822-1858: Partnerships Without Kinship" by Eric Hilt and Katharine O'Banion, concerns the adoption of the limited partnership paradigm by the United States. The authors note that, while the British were somewhat reluctant to adopt a new economic partnership from the French, the relatively new American economy was more eager to experiment with the new. The premise of the article is then to investigate the ways in which the limited partnership manifested itself in the United States.

Interestingly, the article notes that there is little evidence to suggest any widespread use of the limited partnership in the United States. According to the authors, the literature seems to substantiate this claim. Indeed, not much is known about firms that did incorporate the limited partnership rule at the time. Specifically, the article focuses upon the limited partnership in New York City from 1822 to 1858. It was found that there was increasing importance attached to the limited partnership in New York City at the time. Indeed, the authors indicate that 1,098 firms during this time employed this form of partnership. The article furthermore describes the exact nature of limited partnerships as these related to ordinary partnerships at the time. In order to substantiate their claims, the authors gathered statistical data from court cases and business documents of the time. Data are presented by means of tables and figures. The conclusion is that limited partnerships in New York City during the time investigated were far more important than currently recognized by the literature.

Indeed, the authors appear to be correct about a basic lack of recognition for limited partnerships in the literature. Authors such as Sven Beckert (2001) for example mention that the 19th century in New York City was a stormy and unstable one in the business world. There were a variety of different business paradigms, all relating to the different sectors of the business world, each with its own interests. The focus on Beckert's work therefore appears to be much wider than that of Hilt and O'Banion. This wider focus however provides a better and wider perspective of the business world at the time than the article. On the other hand, it must also be said that the article's brevity dictates it narrower focus. It is therefore all the more important that the article's focus be unanimous throughout the introduction, body and conclusion.

The work by John Joseph Wallis is more brief, and addresses the basic American premise of democracy in its business paradigms of the time. The focus is however wider, in addressing the corporation system throughout the United States and not only in New York. It appears to substantiate the premise of the article being considered here, in that there is a break from the English paradigm of ordinary partnerships in favor of special and limited partnerships. For the Americans, the importance of the freedom concept was also applicable to their business paradigms.

Amalia D. Kessler (2003) substantiates the idea that limited partnerships in the United States were closely related to democracy. She compares this paradigm with its origins in France, where it served the purpose of nobility. Limited partnerships in France allowed noblemen to make investments without jeopardizing their nobility. It however served a much different purpose in the United States. Here it served the purpose of democracy, where all business partners were allowed to pursue wealth in a democratic manner.

Ms. Kessler emphasizes that limited partnerships served their purpose at the time, but that they are no longer in use for either the same purpose or in the same form. Contrary to the claim by the authors of the article under discussion, the author appears to believe that limited partnerships were indeed important during the time of their inception.

Lamoreaux and Rosenthal on the other hand appear to claim that American laws in no way changed any more quickly to adapt to American business models and democracy than did the laws in European countries. Indeed, this article again appears to support the claim that there is not much literature to address the idea of limited partnerships in the United States.

In general, there appears to be a wide diversity of literature that considers the business paradigms of the time under consideration. The literature discussed here each addresses a different type of paradigm, environment, or basic premise. There appears to be little agreement among the various authors regarding the importance or indeed the premise of the limited partnership at the time, either in New York City or elsewhere in the United States.

The article, as it claims to do at the beginning, therefore contributes to an important body of business research for specific partnerships during the first half of the 19th century. This is particularly the case as little literature appears to address the specific issues involved. However, there are some shortcomings that could be detected, particularly when relating the introduction of the article with its actual premise.

Firstly and most importantly, there appears to be some discrepancy between the introduction of the article and its actual premise. The beginning of the article appears to indicate, for example, that there the literature does not suggest a large amount of limited partnerships during the time investigated. The body of the article however appears to be more concerned with comparing limited and special partnerships with ordinary ones.

The article for example provides a large amount of data relating to the wealth levels of limited and special partnerships as opposed to ordinary ones, while there is no reference to such comparisons in the introduction. The introduction however does mention newly collected data to suggest the importance of limited partnerships at the time. As it stands, the introduction therefore appears to be somewhat misleading in its focus. The focus appears to be the importance of limited partnerships. There would have been more continuity among the article's parts if there had been an indication of the numerous comparisons and specific data to be given. Instead, the introduction is very vague in terms of what is to be expected later.

Another shortcoming of the article also resides in its introductory features. There appears to be very little mention of existing literature. Although the authors claim that existing literature considers limited and special partnerships as "unimportant," no substantiating literature is offered in this regard. Indeed, the article appears to offer very little at all in the line of a literature study. Along with the lack of connection between the body and introduction, this shortcoming contributes to the basic lack of focus in the article as a whole.

I believe that the article would have derived considerable benefit from addressing the divergence among the authors mentioned above. A comparison among some of the authors could for example have provided a valuable starting point for and indeed unity with the comparisons provided in the body of the article.

Finally, the only reference to literature of any kind appears to be to the "newly collected data" mentioned at the beginning. The majority of the article offers a large amount of statistical data regarding limited partnerships, special partnerships, and the wealth levels of these. Furthermore, these data are compared to ordinary partnerships.

Although the comparisons and data presentations are thorough, substantiated, and apparently accurate, again the authors mention little about the initial focus indicated in the introduction. Furthermore, there is a basic lack of comparison to the existing literature indicated in the introduction.

In short, the most significant shortcoming in the article therefore appears to be in its presentation of the literature, and how this relates to the data presented in the tables. There is a lack of balance between the existing literature and data presentation. This shortcoming relates to the credibility of the article's premise itself. The initial indication is that the lack of literature relating to the importance of limited partnerships in New York City during the first half of the nineteenth century. The rest of the article however simply appears to be a comparison of the data, with only the conclusion revisiting the issues mentioned at the start of the article.