Russian Economy - Alexander III

Russia

Consolidation and Early policies: 1881 -1885

• After Alexander II’s assassination, Alexander III reversed many liberal reforms.

  • Policies emphasised autocracy, (Manifesto of unshakable autocracy -Intervention and control of key sectors

• 1881: Peasant Land Bank - provide credit to peasants for purchasing land.

  • lacking liquidity, and the bank mainly benefited wealthier peasants (kulaks).

  • Many couldn’t access land

• Redistribution of land continued under the mir system - discouraged individual initiative and agricultural innovation.

• Heavy taxation on peasants, particularly through indirect taxes on goods like vodka, continued to fund the state and its industrialisation efforts.

Economic Modernisation and Industrial Expansion: 1885-1889

• 1883-1889: Progress on Trans-Siberian Railway, which aimed to link European Russia with the Far East.

• Sergei Witte, later, Finance Minister, began to emerge as a key figure in driving state-led industrialisation.

• Focus on heavy industries e.g. Donbas (coal) and Urals (iron) regions.

• To protect domestic industries, 1887 Tariff Act

State Control and Consolidation: 1889 - 1894

• The government strengthened state finances by accumulating gold reserves and stabilising the rouble.

• Despite the Peasant Land Bank, the majority of peasants continued to face land shortages, poverty, and high taxes.

• Famines, such as the 1891-1892 famine, highlighted the fragility of Russia’s agricultural system.

• By the 1890s, Russia was experiencing significant industrial growth, particularly in urban areas.

• The state encouraged the development of factories and urban centres, leading to the growth of a working class, though their conditions remained harsh - Moscow and St Petersburg

Legacy of Alexander III’s Economic Policies

• Achievements:

  • Russia saw the beginnings of rapid industrialisation, which would continue into the 1890s and 1900s under Nicholas II and Sergei Witte.

  • Expansion of the railway network, particularly the Trans-Siberian Railway, laid the groundwork for integrating Russia’s vast territories.

  • Protectionist policies fostered growth in industries like steel, coal, and oil, turning Russia into a rising industrial power.

• Failures:

  • The agricultural sector, which employed the majority of Russians, was neglected. The mir system and redemption payments continued to stifle progress, perpetuating peasant poverty and unrest.

  • The 1891-1892 famine revealed the weaknesses of the agrarian economy and poor state management.

  • Growing urbanisation and industrialisation led to the rise of an exploited working class, sowing the seeds for future social unrest.