16. Statistics of business grow ing favor of the corporation is plainly evidenced in the statistics of ownership of manufacturing concerns in the United States. The table on page 12, which will throw light on this subject, is taken from the census of manufactures.
The growth in number of corporate concerns has not been so great as that in the value of the products they turn out, which is far more important. A glance at the table will show that the larger industries are in corporating. The corporations, as a matter of fact, employ about three-fourths of the wage-earners. Moreover, it is apparent that in recent years the growth of the corporation has been at the expense of the partnership.
17. Where the corporation has gained If one turns his attention to the various industries in the United States, lie will find that in some lines the corporate form is achieving favor more rapidly than in other lines. Almost all public-service concerns, such as railroads and gas plants, are incorporated. Besides the fact that enterprises of this kind are large and require capital investments beyond the means of the individual, there are several reasons why most pub lic-service organizations incorporate. In the first place, the state would be loath to delegate to indi viduals the right of eminent domain ; that is, the right to condemn private property and to take it for a reasonable price, without the consent of the owner. Such an important right must be conferred only on corporations that are subject to strict public regula tion. Then, too, these corporations are ordinarily given a right which could not easily be conferred upon individuals; namely, the right to enter upon the prop erty of others without committing trespass, in order to make preliminary surveys. Finally, public-service businesses must have a more stable and continuous existence than either the individual or the partnership could provide.
In ordinary industrial lines, the corporation has always gained ground where large-scale production is important. For example, in the manufacture of glass, iron and steel, locomotives, cotton-seed oil and refined petroleum, over 88 per cent of the establish ments are owned by corporations. The figures for 1914 show that the entire business of manufacturing rubber belting and hose, as well as that of manufac turing sulphuric, nitric and mixed acids, is carried on by corporations.
18. Where individual and partnership organization survives.—Whenever an industry can be started with the investment of little capital, we naturally find a predominance of individual ownership. Thus, in the industries ordinarily carried on in the cities—those which are sometimes called the needle trades—we find many individually owned establishments. In men's clothing manufacture, 52 per cent of the concerns are owned by single proprietors and probably the greater nwilber of the remainder are owned by firms.
Probably in a great many industries in which little capital is required, there is a constant progress of in dividuals from the ranks of the employes into those of the proprietors. There is, however, a movement in the other direction also, which becomes most notable in times of business depression. The industries thus subject to fluctuating ownership are those that pro duce unstandardized goods and those in which labor makes up a, large part of the cost of manufacture. In tobacco manufactures, 82 per cent of the establish ments are under individual ownership ; in baking, 83 per cent; in broom-making, 65 per cent; and in rag carpet manufacture, 75 per cent. In some of the older industries, such as carriage-making, where over 66 per cent of the establishments are individually owned, perhaps the survival of the individual shop is due to inertia.
Wherever the individual form of ownership thrives, we are apt to find also a comparatively large number of businesses controlled by firms. In one department of the needle trades, fc- 'nstance—the manufacture of women's clothing—the percentage of establish ments owned largely by partnerships is over 40 per cent. This is the highest percentage of partnership organization reached in any industry.
19. Other fornts of organization.--,-Almost the en tire business of the country is carried on by individuals, partners or corporations. Limited partnerships are unusual, and tho convenient, and for some purposes advantageous, they are not used, except in a few trading businesses in the larger cities, where their ad vantages have undoubtedly been called to the atten tion of business men by progressive lawyers. Joint stock companies are used scarcely at all. Modern tax laws usually prescribe the same treatment for them as for corporations, and new associations gen erally prefer the corporate form. Some of the older joint stock companies, such aS the United States Ex press Company, have gone out of business, and it is probable that not long hence this type will possess merely an historical interest. The business trust, tho it increased in favor about ten years ago, seems destined to meet the same fate as the joint stock com pany, tho there is a possibility that it may take the place of holding companies.' Altho cooperative associations are increasing in this country, they are not, as in England, being used to any great extent in the promotion of all the functions of a business enterprise; instead, they are being used in connection with some one function, such as marketing or financing. Thus we fin - many cooperative credit unions and marketing associations in the rural dis tricts.
On the whole, the corporation is toda.y the most in teresting and the most important form of business or ganization. For that reason it has been given more attention in this Text than any of the other forms.