Business in Uncertainty and War: Trust and Risk for Siemens in Harbin and Vladivostok, 1914-1923

Abstract

The view that a long period of globalization ended when World War I broke out in 1914 has long prevailed in economic history. This view, however, has recently been contested and it has been argued that 1914 rather marks the beginning of a globalization of new and different processes. We contribute to this globalization-deglobalization debate with a study of Siemens’s technical bureaus in Vladivostok and Harbin between 1914 and 1923, when the bureaus lost contact with Siemens in Germany and were left alone to tackle the difficulties and insecurity caused by World War I and the Russian Civil War. In spite of the new and radically different political situation, Siemens did not decrease its long-term commitment to business in East Asia and its fine-meshed network of branches and divisions there. Instead of decreasing its transnational activities, Siemens adjusted to the increased Japanese and decreased Russian influence in East Asia. Siemens´s persisting commitment to business in the region was all the more important as the company had ambitions of restoring the global role it held prior to 1914 whilst at the same time suffering from restricted access to many of its most important markets in the West in the aftermath of World War I. In East Asia, Siemens pursued a conservative entrepreneurial ideology in which trust between its different branches and the need for information about the local situation played a decisive role. When trustworthy business partners had been found and a more predictable business environment was in place, business could continue as usual.