Economic History ch6

Birth of Railways

in GB mining sector transporting in and out of mines

• 1830- Manchester-liverpool

• fast, cheap transport of goods and people

• boosted metallurgy industry

• unified territories, “first globalization” made possible

Great Exhibit of London 1851

displayed locomotive and industrial wonders. very popular— 1/3 english saw. foreign visitors inspired

Key differences of the 2nd Industrial Revolution

-1850

• new countries

• new sectors— chemistry, steel, electricity

• new types of enterprise

• substitutable factors

Pillars of Second Industrial Revolution

• tech innovation

• new sectors— chemistry, electricity, metallurgy

• scientific knowledge applied

  • new organizational structures within firms

birth of large-scale enterprise

• revolution in communication and transport

• new management tools and styles

• production processes enable economies of scale and diversification

• vertical integration

How did governments plan industrialization to copy Britain?

• protectionism

• mixed banks to finance. enabled initialinvestment and EoS

• promotion of industries

• gov bailouts

Latecomers advantage of backwardness

• unburdened by obsolete tech, could simply invest in the best immediately

Similarities of latecomers and early adopters

• sacrificed immediate QOL for long-term growth

• modern tech

• capital intensive production

  • agricultural role reduced

Pollard’s opinion of industrial spread

it is regional, and largely depended on govs efforts, how people responded, and the resources available

German economic unification

Bismarck unified 1871

• uniform currency

• protectionism

• IP

• gold standard

Important developments for German industrialization

• Bessemer steel production in England → Thomas process to remove phosphorous in German steelenabled german steel to compete

• 1931 eve of WWI, Germany leads in steel production. much much bigger than GB

• Great education

• German firms became larger than GBs

• new industries formed cartels, enabled by gov. → emigration

• Mixed banks very large role— represented on company boards

Italy unification

1861 new civil code, currency.

1870-1890s Italy progression

• began with some textile and railway

• protectionism → growth in textiles and metallurgy

• establishment of mixed banks CREDIT and COMIT spurred industry

  • major turning point 1896. metallurgy, steel and chemicals and cars

Italy’s emigration

• shortage of labor. Industrial success limited to the industrial triangle— Turin, Milan, genoa.

  • made more resources available, emigrants sent money back home, and created demand for Italian exports

Why didn’t Italy industrialize earlier?

• no coal

• no literacy

• no infrastructure

• no financing

• no social or political stability

Case of the United States

• early on had vast resources and land but low population density. began very agricultural

• Shortage of labor encouraged early mechanization

• adapted British tech and introduced components and standardization— Colt’s firearms

• Mid 19th century, NE manufacturing trade and finance, West livestock and cereal, south colonial goods sugar tobacco cotton.

• Civil War— North wins, protectionism implemented

• Standardization, components, assembly line, mass immigration= workforce

• Sherman Antitrust aCT= no coalitions

  • On eve of WWI, US is an industrial leader

Why did Britain fall behind?

• no new sectors

• decline of traditional sectors

• no entrepreneurship

• first-mover disadvantage