Industrialisation of the Continental Powers 1780-1914, The

Clive Trebilcock

• Publisher: Routledge
• Year: 2014
• Print ISBN: 9781138175617
• eBook ISBN: 9781317872146
• Topic: History
• Subtopic: European History
• Index: History

The Industrialisation of the Continental Powers is both a broad survey of the process of European industrialisation from the late eighteenth century to the First World War, and also a closely argued comparative economic study of how this process was experienced by different great powers.

CHAPTER ONE

Historical Models of Growth

Symbolically, the European civilization of 1914 could be represented as precisely by the steam-hammer or the steam warship as it had once been by the cathedral spire or the knightly banner. Modern technology had established itself across wide areas of a continent dominated, only decades previously, by the feudal lord and the urban guild. There were engineering works in Spezia and Tsaritsyn, automobile factories in Vienna and Milan, dreadnought yards in Fiume and Ferrol. In the great coal and metallurgical complex of Rhine-Ruhr, Europe could boast the world’s most concentrated and integrated industrial area. And at St Etienne, Hayange, or Décazeville, the French industrialists had created a handful of manufacturing installations which could rival any in existence. To the casual glance, it might appear that industrialization had overtaken Europe from the Mediterranean to the Baltic, from the Channel to the Danube. But, clearly enough, industrialization did not possess the same value wherever it touched. A machine-shop in Budapest did not possess the same significance as a machine-shop in Birmingham or Berlin. Despite the outward similarities, industrialization in Europe was a phenomenon of very variable pace and intensity, offering radically different prospects of wealth and power as it crossed frontiers and resource areas. To begin with, it may be useful to provide a rough outline of the divergent pattern of achievement among the main industrial contenders.

Within this period some areas of the continent did manage to graduate from industrial infancy to flourishing, if early, adulthood. For them, the process of advance was relatively gradual; they were not so far behind Britain – the international exemplar in the manufacturing arts – that the business of economic modernization had become an institutionalized technique. Parts of France and segments of the German states, for instance, displayed, as early as the middle eighteenth century, an apparent potential for industrial growth that resembled the British capabilities of the same era more than fleetingly. Yet it was another century and a half before the French and German economies were safely entrenched within the high-technology stage of development, equipped with the chemical, machine-tool and engineering factories which picked out the leading economies of the pre-1914 world. Generally speaking, their rate of industrial advance had quickened – after an extended period of economic preparation – around the fourth or fifth decades of the nineteenth century. In the process, they had drawn as selective, if not systematic, imitators upon the technology and experience supplied by the industrial prototype across the Channel. By 1914, however, they had no further need to imitate. Within limits, by European standards, and with Germany decisively leading France, these countries – the long-run developers – could be described, by the time of the First World War, as the successful economic powers of continental Europe.

For another group of countries, including tsarist Russia, the Austrian section of the Habsburg Empire, and freshly united Italy, industrialization followed a different pattern. In these cases the early industrial stirrings were much weaker; the industrial surge at mid-century was much less pronounced; and the major part of growth inside the period was concentrated within the thirty years before the First World War. Among this group, the level of backwardness – set largely by the ballast of semi-feudal agricultures and the economic deadweight of large peasant populations – was more pronounced and the base from which industrialization commenced much lower than was the case for the early developers. Partly because of this low starting point, partly because of their ability to extract aid of a technological, financial, or entrepreneurial type from their continental predecessors, as well as from Britain, the initial development of this group exhibited a tendency to be more rapid and compressed than anything which had gone before. It is from growth patterns like these that notions of the ‘big spurt’ or the ‘big push’ in industrial expansion derive. But if the growth rates veered upwards for these countries, their problems of backwardness remained acute, and in few cases had the former suppressed the latter by 1914. At the end of the period, this group could claim a partial success in industrialization. Its members had achieved a form of economic adolescence, sometimes tempestuous as with Russia, sometimes demure and withdrawn as with Austria.

Behind the adolescents came the problem children, the sick offspring of the old regimes, struggling for survival by dint of modern economic achievement. Among this group, Spain and the Habsburg satellites, especially Hungary, provide typical cases. Here the proto-industrial activity came late in the period and the degree of under-development was so severe that the possibility of leaping out of backwardness astride high industrial growth rates was remote indeed. At the outbreak of the First World War, the degree of industrial achievement in these areas was small, and much time would elapse before it could be otherwise.

Even from such a cursory inspection of the continent’s manufacturing attributes, it is obvious that nothing so monolithic as ‘an industrial revolution in Europe’ occurred in the nineteenth century. The experience of industrialization was most certainly not uniform between countries; instead, there was an immense variety of growth rate, technological advance, and managerial expertise. Nor is it obvious that single countries had their industrial ‘revolutions’. For the most successful of the early developers – particularly the off-shore manufactory of Britain – modern research insists that industrial growth was gradualistic, evolutionary, achieved not in the violent spontaneous outburst of revolution, but in the plodding long run. Illumination for the industrial pathway was provided not by the ‘thunderbolt from a clear blue sky’ but by decades of candle-ends. Naturally, this does not mean that all economic modernization must be gradualistic; for the later developer, able to ‘borrow’ and to implement complete industrial systems in short order, the prospects of a ‘big push’ certainly become more feasible. Correspondingly, the middle group of countries did experience a pace of development which could be energetic. But it could also be – and frequently was – restricted by sector, or by region, in a style which could leave huge backward agricultures more or less intact, or relegate whole tracts of the nation to the status of undeveloped areas within the host economy. The scale or extent of such growth may fall short of the ‘revolutionary’. And, for the very late developer, the shortfall will be even more acute, since the advantages of ‘borrowing’ will be extensively qualified by the rudimentary economic equipment of the borrower. For this third category of country, persistent economic deprivation, rather than any species of sudden industrial onrush, remained the problem.

In order to assess such widely differing cases, and give due allowance to the various degrees of industrialization achieved in Europe, a number of measuring tools are required. For the individual economy, a method of analysis is needed which will detect the presence or absence – and if presence, also the quality – of the materials for growth, and will distinguish between the various stages of development within the economic system. Further, we need to allow for the varying levels of backwardness between countries and for the effects that the given distribution of European backwardness had on the industrial growth of the various national economies. Stock must be taken not only of the physical resources, or the lack of them, but also of the social endowment which will supply, or fail to supply, an entrepreneurial shockforce which may be able to innovate a way past the obstacles imposed by the allocation of resources. In addition, there must be a place within our assessment for an element of politics; for it is an often-neglected feature of economic development viewed historically that a political preference – frequently for the maintenance of social stability or for an improved military capacity – may close or open an economic option. Similarly, in the reverse procedure, economic events – as the determinist thinkers have more widely publicized – may create political problems. Yet, if the policy of nation-states both influences, and may be influenced by, industrial growth, it is not always the case that industrial growth is a national phenomenon. Some allowance must be made for the fact that economic advance may be highly regionalized, and that an industrial region in one country may compare, and may co-operate, more closely with an industrial area in a foreign country than it does with its own agricultural hinterland. Thus, industrialization, in this sense, may be more a European experience than a national one, though still by no means a uniform experience.

Various models or analytical constructs are available to the economic historian which attempt these tasks of measurement, naturally enough with fairly diverse amounts of success. In this study it will be convenient to employ, in particular, three formal models and to link to them a pair of hypotheses of somewhat more humble theoretical pretension. It does not necessarily follow that all will function satisfactorily within their own terms of reference, but, for the purposes of this analysis, the points at which they fail may be no less significant than those at which they successfully reflect reality. In each case, the analytical tool will be used recurrently so as to provide a number of refrains running in parallel through the argument.

THE ROSTOW MODEL: THE AIRBORNE ECONOMY

This is a reasonably simple – some would say crude – ‘stage theory’, dividing the process of industrialization into a number of distinct – most would say over-distinct – phases.¹ The initial phase from which the expanding economy must emerge is that of the ‘traditional society’, a benighted world ‘based upon pre-Newtonian science and technology’. If all goes well, this dim scenario is exchanged, in the fullness of real time, but fairly briskly in Professor Rostow’s analysis, for the ‘preconditions’ stage, a form of industrial apprenticeship in which the qualifications for industrial growth are painstakingly gathered together. After this grooming process, comes, somewhat less spontaneously than the traditional industrial revolution but hardly less explosively, the stage of ‘take-off’. At this point the manufacturing sector lifts away from its economic base in the same style as an aircraft from its runway or a missile from its launching pad. Perhaps the choice of analogy is revealing: in place of God’s thunderbolt descending we have Man’s vehicle ascending, and although the operation of each is fairly abrupt, one clearly requires more preparation than the other. The most significant characteristics of ‘take-off’ are: its short chronological span, requiring ‘lift-off’ to be effected within two or three decades; a doubling in the proportion of national income productively invested; and the growth of certain major industries to form ‘leading sectors’ within the economy. As the analogies proliferate, the economy then moves forward into the next stage: after ‘taking off’ like a missile it is required to embark upon the ‘drive to maturity’, a process of ageing and increasing sophistication undergone by fine wines, favourite pipes, and, it would appear, economies. In this state, at any rate, the process of industrial growth becomes ‘sustained’, or irreversible. When it has been sustained for a sufficiently long period, a final stage, the terminus ad quem of the model, will be reached: this is the age of ‘high mass consumption’.

Whatever its drawbacks – and they are considerable – the Rostow model possesses one obvious, if humble, advantage: it offers a highly generalized vision of industrialization which touches upon the actual industrial fortunes of a number of European countries at a variety of points. As long as it is construed in these very general terms, some few statements of moderate utility may be derived from it. Allowing overlapping periods, it would seem safe to say that a sizeable group of countries experienced something like a ‘preparation’ phase, or a ‘proto-industrial’ phase, or, to employ Rostow’s term, a ‘preconditions’ phase, at some time within the period 1800–70, a burst of more rapid growth, reminiscent of a ‘take-off’ phase, at some time within the period 1840–95, and, for a few, the initial suspicions of the ‘drive to maturity’ at some time within the period 1870–1914. But as an approach, this is painfully non-specific, and the over-lapping time periods adopted here allow an extremely generous degree of latitude which, though necessary if the Rostowian system is to be made to produce a description of ‘European’ range, jeopardizes accurate analysis.

Perhaps the drawbacks are more obvious than the utility. Briefly, the model is too explosive, too neat, and too monolithic; it postulates growth which is rapid, but, at the same time, orderly in progression, and derived from a limited number of sources. Although a preparation phase is built into its structure, the major requirement is that the critical work of industrialization should be executed to the short order, within two or three decades. This runs clean counter to the growing preference among economic historians for the application of an evolutionary mode of interpretation to a growing number of historical cases. And, in terms of record, the requirements for the successful short-haul ‘take-off’ seem to have been fulfilled in few detectable instances. Certainly the belief that economies may within thirty years double their rate of ‘productive’ investment – from below 5 per cent to above 10 per cent of national income in the basic interpretation² – has met with remarkably little authentication of a convincing historical type.³ In the observed cases the time required for this process – in so far as the data reveals it – appears to considerably exceed thirty years, thus arguing for an important ‘stretching’ of the ‘take-off’ process.⁴ Furthermore, the identification of the ‘take-off’ stage by associating with it the emergence of ‘leading sectors’ has proved to be a good deal less than foolproof, since, as is fairly obvious, major industries have a perennial tendency to move forward into dominating positions, before, during, and after ‘take-off’.

Excessive neatness as a complaint attaches most damagingly to the proto-industrial phase of the model. It is possible, by abstracting from Professor Rostow’s various descriptions of the preconditioning equipment, to establish a schedule itemizing at least its more important components.⁵ These prerequisites would appear to be:

(a) a transformation in agriculture (or ‘agricultural revolution’), yielding higher productivity on the land and thus freeing surplus labour, food, and raw materials for use in industry;

(b) an accumulation of social overhead capital, mostly in the form of transport-related facilities (such as ports, docks, canals, or railways) which would act to extend markets, allow supply and demand to interact quickly and efficiently, and move in raw materials at tolerable prices and move out bulky industrial products at tolerable costs;

(c) a development of the ancillary services for industry, most especially banking;

(d) the presence of entrepreneurs willing to take risks in non-conventional fields;

(e) the presence of initial minima of skilled labour and power resources;

(f) an increased exploitation of domestic raw materials or an increase in the importation of foreign ones.

Most of these are formally described as ‘preconditions’ by Rostow; others are suggested less explicitly; and the schedule is not exhaustive.⁶ However, the factors listed above are representative of the Rostowian interpretation and provide a fair mark upon which to direct counter-arguments.

Logically, if the conceptual neatness of a separate, self-contained preconditions stage is to lend a justified shapeliness to the analysis of industrial growth, we might require that two simple criteria should be fulfilled. Firstly, that the various prerequisites should be unique to the proto-industrial stage; secondly, that they should be unique as a collectivity: they should occur at no other stage of the growth process and they should certainly exhibit no mobility in any numbers.⁷ Additionally, we might expect that if the preconditions are genuinely necessary for industrialization, they should be noticeably present in all countries which do industrialize. But, in fact, Rostow’s brainchildren measure up to these requirements in disappointing style. Even the most casual review of nineteenth-century economic development will reveal that many of the factors described by Rostow as preconditions may occur at almost any stage of the growth process, often well after the economy has embarked upon ‘take-off’. Thus in Russia, the lending of capital, ‘on long term, at high risk, to back the innovating entrepreneur’⁸ through an effective native banking system did not develop in advance of the industrial spurt of the 1890s, but in the 1900s, when the spurt had already begun to slow. Similarly, Russia’s agricultural transformation is difficult to detect: it certainly did not precede 1890; it may have arrived with Stalin’s collectivization programme of the 1930s; or, as some would argue, it may be yet to come. In Italy also, agriculture has presented a problem: here industrialization occurred against the ba...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Dedication
• Table of Contents
• List of Tables
• List of Maps
• Acknowledgements
• Preface
• Chapter One Historical Models of Growth
• Chapter Two Germany
• Chapter Three France
• Chapter Four Russia
• Chapter Five The Powers of Deprivation: Italy, Austria-Hungary, Spain
• Chapter Six Anti-Models
• Chapter Seven Statistics and Structures
• Bibliography
• Index