Industry Studies
Gail M. Pesyna and A. Frank Mayadas, Program Directors
What Is Industry Studies?
Industry studies is an observational science. It is one of many such sciences: in the physical sciences, its parallel is astronomy. Astronomy is a science, but it is not a laboratory science – one cannot do astronomy in a lab. Rather astronomers observe the heavens in all their complexity and then build theories to try and explain what has been observed. Like astronomy, in which there are people who observe and people who do theory and try to bring order out of the observations, both types of scholars exist within the industry studies community.
Even more like industry studies is that part of the life sciences dealing with ecological systems. Biologists observe the behavior of ecological systems, of the animals and plants that are prominent in such systems, and how they interact with each other and with their surroundings. They then build theories to explain what they or others have observed.
In industry studies the systems of interest involve companies, markets, institutions, the people in them, and their interactions, instead of animals and forests, or stars and galaxies. But such studies also cannot be done in a lab: they require observation in the field to accurately understand and describe the complexity of it all.
Industry studies is also not new. Its intellectual roots can be traced to leaders such as Adam Smith (1723-1790) and Alfred Marshall (1842-1924), who demonstrated that the scientific foundation of economics and its social effects are enhanced by grounding analysis in the direct observation of production processes and in the practical experience of industry. Modern economics began with Adam Smith’s visit to a pin factory, which helped him explain how the division of labor worked (The Wealth of Nations, Chapter 1). In his preface to Industry and Trade (1919), Alfred Marshall explains that he had a career-long practice of visiting manufacturing plants so that he might be better informed by the experience:“Nearly half a century has passed since I set myself the task to obtain some insight into industrial problems by obtaining leave to visit one or more representative works in each chief industry. I tried to get such a knowledge of mechanical technique ... as would enable me to understand the resources and the mode of operation of all elementary plant in general use: I sought also to study the relations between technique and the conditions of employment for men and for women.”
In Memorials of Alfred Marshall, Arthur Pigou, a former student of Marshall’s, explains why this was important:
“What [Marshall] aimed at in all of this was to get, as it were, the direct feel of the economic world, something more intimate than can be obtained from merely reading descriptions, something that should enable one, with sure instinct, to set things in their true scale of importance, and not to put in the forefront something that is really secondary merely because it presents a curious problem for analysis.”
It is for such reasons we believe that the results of observation-based industry studies research integrated with theory and analysis contribute importantly not only to academic knowledge, but also to the industries studied and to public policy.