Abstract: The Arduous Rise of the Telephone in Postwar Europe: A View into, and beyond, the Inefficiency of the Bureaucratic State-Business Culture

Remi Gilardin

Abstract

In 1967, in France, an individual, or even a business, requesting a connection to the telephone network would have had to wait, on average, for three years before his demand was met. At the same date, in the United States, three days would have sufficed. The situation was hardly better in Britain. Why, in Europe's advanced industrial economies, was the national management of the telephone business profundly inefficient? To understand this economic failure, two sets of factors can be put forward. On the one hand, the problem largely derived from a pervasive lack of interest in phone technology. This 'cultural' factor was widespread among the masses, thus preventing the emergence of a large market—at least until the 1960s—as well as within the political elites in power, thus preventing the expansion and modernization of the networks. On the other hand, the sectoral institutional arrangement in the two countries—a state monopoly run by a government department, the PTTs—hampered the rise of the telephone. This paper demonstrates how these two elements formed a synergetic vicious circle that led to economic backwardness, and how, in the end, the vicious circle was broken and business efficiency restored.