Industrialisation

The effect of Industrialisation shown by rising income levels since 1500. The graph shows the gross domestic product (at purchasing power parity) per capita between 1500 and 1950 in 1990 International dollars for selected nations.^[1]

Map showing the global distribution of industrial output in 2005, based on a percentage of the top producing state, the United States

Industrialisation (or industrialization) is the period of social and economic change that transforms a human group from an agrarian society into an industrial one. It is a part of a wider modernisation process, where social change and economic development are closely related with technological innovation, particularly with the development of large-scale energy and metallurgy production. It is the extensive organisation of an economy for the purpose of manufacturing.^[4] Industrialisation also introduces a form of philosophical change where people obtain a different attitude towards their perception of nature, and a sociological process of ubiquitous rationalisation^{[citation needed]}.

There is considerable literature on the factors facilitating industrial modernisation and enterprise development.^[5] Key positive factors identified by researchers have ranged from favourable politico-legal environments for industry and commerce, through abundant natural resources of various kinds, to plentiful supplies of relatively low-cost^{[citation needed]}, skilled and adaptable labour.

As industrial workers' incomes rise, markets for consumer goods and services of all kinds tend to expand and provide a further stimulus to industrial investment and economic growth.

The first country to industrialise was the United Kingdom during the Industrial Revolution, commencing in the 18th century.^[3]

By the end of the 20th century, East Asia had become one of the most recently industrialised regions of the world.^[6]

Description

According to the original sector-classification developed by Jean Fourastié (1907-1990), an economy consists of:

• a "primary sector" of commodity production (farming, livestock breeding, exploitation of mineral resources)
• a "secondary sector" of manufacturing and processing (as paid work)
• a "tertiary sector" of service industries

Historically, the industrialisation process involves the expansion of the secondary sector in an economy originally dominated by primary-sector activities.

The first transformation to an industrial economy from an agricultural one, known as the Industrial Revolution, took place from the mid-18th to early 19th century in certain areas in Europe and North America; starting in Great Britain, followed by Belgium, Germany, and France. Later commentators have called this the first industrial revolution.^[3][7]

The "Second Industrial Revolution" labels the later changes that came about in the mid-19th century after the refinement of the steam engine, the invention of the internal combustion engine, the harnessing of electricity and the construction of canals, railways and electric-power lines. The invention of the assembly line gave this phase a boost.^[8][9][10]

The lack of an industrial sector in a country can slow growth in the country's economy and power, so governments often encourage or enforce industrialisation. On the other hand, the presence of industry in a country does not mean in general that it will bring wealth and prosperity to the people of that country. And third, the presence of an industry in one country can make it more difficult for other countries to develop the same type of industry. This can be seen in the computer software and internet industries. Started from the US around the 1990s these industries seemed to spread over the world. But after a period of monopolisation less than a decade long, the globally-leading companies remain concentrated in the US.^{[citation needed]} Their economic power and capacity to dominate the media work against the developing of the same types of industry in other states.

History of industrialisation

A Watt steam engine, the steam engine fuelled primarily by coal that propelled the Industrial Revolution in the United Kingdom and the world.^[2]

Most pre-industrial economies had standards of living not much above subsistence, among that the majority of the population were focused on producing their means of survival. For example, in medieval Europe, as much as 80% of the labour force was employed in subsistence agriculture.^{[citation needed]}

Some pre-industrial economies, such as classical Athens, had trade and commerce as significant factors, so native Greeks could enjoy wealth far beyond a sustenance standard of living through the use of slavery^{[citation needed]}. Famines were frequent in most pre-industrial societies, although some, such as the Netherlands and England of the 17th and 18th centuries, the Italian city states of the 15th century, the medieval Islamic Caliphate, and the ancient Greek and Roman civilisations were able to escape the famine cycle through increasing trade and commercialisation of the agricultural sector^{[citation needed]}. It is estimated that during the seventeenth century Netherlands imported nearly 70% of its grain supply and in the fifth century BC Athens imported three-quarters of its total food supply.^{[citation needed]}

Industrialisation through innovation in manufacturing processes first started with the Industrial Revolution in the north-west and Midlands of England in the 18th century.^[11] It spread to Europe and North America in the 19th century.

Industrial revolution in Europe

Aplerbecker Hütte, an industrialised area of Dortmund, Germany circa 1910. The old town can be seen beyond and some remaining agricultural land is in the foreground

In the 18th and 19th centuries, the UK experienced a massive increase in agricultural productivity known as the British Agricultural Revolution, which enabled an unprecedented population growth, freeing a significant percentage of the workforce from farming, and helping to drive the Industrial Revolution.

Due to the limited amount of arable land and the overwhelming efficiency of mechanised farming, the increased population could not be dedicated to agriculture. New agricultural techniques allowed a single peasant to feed more workers than previously; however, these techniques also increased the demand for machines and other hardware, which had traditionally been provided by the urban artisans. Artisans, collectively called bourgeoisie, employed rural exodus workers to increase their output and meet the country's needs.

British industrialisation involved significant changes in the way that work was performed. The process of creating a good was divided into simple tasks, each one of them being gradually mechanised in order to boost productivity and thus increase income. The new machines helped to improve the productivity of each worker. However, industrialisation also involved the exploitation of new forms of energy. In the pre-industrial economy, most machinery was powered by human muscle, by animals, by wood-burning or by water-power. With industrialistion these sources of fuel were replaced with coal, which could deliver significantly more energy than the alternatives. Indeed, much of the new technology that accompanied the industrial revolution was for machines which could be powered by coal. One outcome of this was an increase in the overall amount of energy consumed within the economy - a trend which has continued in all industrialised nations to the present day.^[12]

The accumulation of capital allowed investments in the conception and application of new technologies, enabling the industrialisation process to continue to evolve. The industrialisation process formed a class of industrial workers who had more money to spend than their agricultural cousins. They spent this on items such as tobacco and sugar, creating new mass markets that stimulated more investment as merchants sought to exploit them.^[13]

The mechanisation of production spread to the countries surrounding England geographically in Europe such as France and to British settler colonies, helping to make those areas the wealthiest, and shaping what is now known as the Western world.

The Crystal Palace Great Exhibition of the Works of Industry of all Nations which took place in London in 1851. The United Kingdom was the first country in the world to industrialise and the exhibition's prime motive was for "Great Britain to make clear to the world its role as industrial leader." ^[3]

Some economic historians argue that the possession of so-called 'exploitation colonies' eased the accumulation of capital to the countries that possessed them, speeding up their development.^[14] The consequence was that the subject country integrated a bigger economic system in a subaltern position, emulating the countryside, which demands manufactured goods and offers raw materials, while the colonial power stressed its urban posture, providing goods and importing food. A classical example of this mechanism is said to be the triangular trade, which involved England, southern United States and western Africa. Some have stressed the importance of natural or financial resources that Britain received from its many overseas colonies or that profits from the British slave trade between Africa and the Caribbean helped fuel industrial investment.^[15]

Whilst these arguments still find some favour with historians of the colonies, most historians of the British Industrial Revolution do not consider that colonial possessions formed a significant role in the country's industrialisation. Whilst not denying that Britain could profit from these arrangement, they believe that industrialisation would have proceeded with or without the colonies.^[16]

Early industrialisation in other countries

After the Convention of Kanagawa issued by Commodore Matthew C. Perry forced Japan to open the ports of Shimoda and Hakodate to American trade, the Japanese government realised that drastic reforms were necessary to stave off Western influence. The Tokugawa shogunate abolished the feudal system. The government instituted military reforms to modernise the Japanese army and also constructed the base for industrialisation. In the 1870s, the Meiji government vigorously promoted technological and industrial development that eventually changed Japan to a powerful modern country.

In a similar way, Russia suffered during the Allied intervention in the Russian Civil War. The Soviet Union's centrally controlled economy decided to invest a big part of its resources to enhance its industrial production and infrastructures to assure its survival, thus becoming a world superpower.^[17]

During the Cold war, the other European socialist countries, organised under the Comecon framework, followed the same developing scheme, albeit with a less emphasis on heavy industry.

Southern European countries such as Spain or Italy saw a moderate industrialisation during the 1950s-1970s, caused by a healthy integration of the European economy, though their levels of development, as well as those of Socialist European Countries, do not match the more advanced standards of other European countries like Germany.^[18][19]

The Third World

A similar state-led developing programme was pursued in virtually all the Third World countries during the Cold War, including the socialist ones, but especially in Sub-Saharan Africa after the decolonisation period.^{[citation needed]} The primary scope of those projects was to achieve self-sufficiency through the local production of previously imported goods, the mechanisation of agriculture and the spread of education and health care. However, all those experiences failed bitterly due to a lack of realism: most countries did not have a pre-industrial bourgeoisie able to carry on a capitalistic development or even a stable and peaceful state. Those aborted experiences left huge debts toward western countries and fuelled public corruption.

Petrol-producing countries

Oil-rich countries saw similar failures in their economic choices. An EIA report stated that OPEC member nations were projected to earn a net amount of $1.251 trillion in 2008 from their oil exports.^[20] Because oil is both important and expensive, regions that had big reserves of oil had huge liquidity incomes. However, this was rarely followed by economic development. Experience shows that local elites were unable to re-invest the petrodollars obtained through oil export, and currency is wasted in luxury goods.^[21]

This is particularly evident in the Persian Gulf states, where the per capita income is comparable to those of western nations, but where no industrialisation has started. Apart from two little countries (Bahrain and the United Arab Emirates), The Gulf states have not diversified their economies, and no replacement for the upcoming end of oil reserves is envisaged.^[22]

Industrialisation in Asia

Apart from Japan, where industrialisation began in the late 19th century, a different pattern of industrialisation followed in East Asia. One of the fastest rates of industrialisation occurred in the late 20th century across four countries known as the Asian tigers (Hong Kong, Singapore, South Korea and Taiwan), thanks to the existence of stable governments and well structured societies, strategic locations, heavy foreign investments, a low cost skilled and motivated workforce, a competitive exchange rate, and low custom duties.

In the case of South Korea, the largest of the four Asian tigers, a very fast paced industrialisation took place as it quickly moved away from the manufacturing of value-added goods in the 1950s and 60s into the more advanced steel, shipbuilding and automotive industry in the 1970s and 80s, focusing on the high-tech and service industry in the 1990s and 2000s. As a result, South Korea became a major economic power.

This starting model was afterwards successfully copied in other larger Eastern and Southern Asian countries, including communist ones. The success of this phenomenon led to a huge wave of offshoring – i.e., Western factories or Tertiary Sector corporations choosing to move their activities to countries where the workforce was less expensive and less collectively organised.

China and India, while roughly following this development pattern, made adaptations in line with their own histories and cultures, their major size and importance in the world, and the geo-political ambitions of their governments, etc..

Meanwhile, India's government is investing in economic sectors such as bioengineering, nuclear technology, pharmaceutics, informatics, and technologically-oriented higher education, exceeding its needs, with the goal of creating several specialisation poles able to conquer foreign markets.

Both China and India have also started to make significant investments in other developing countries, making them significant players in today's world economy.

Newly industrialised countries

The countries in green are considered to be newly industrialising nations. China and India (in dark green) are a special case.

Since the mid-late 20th century, a few countries in Latin America, Asia, and Africa, such as Brazil, Indonesia, Malaysia, Mexico, Philippines, South Africa, and Turkey have experienced substantial industrial growth, fuelled by exporting to countries that have bigger economies: the United States, China, India and the EU. They are sometimes called newly industrialised countries.^{[citation needed]}

Despite this trend being artificially influenced by the oil price increases since 2003, the phenomenon is not entirely new nor totally speculative (for instance see: Maquiladora).

Japan and Russia both were successful in the fact that they imitated many other societies giving them flexibility. Yet they both had very little in common before the 19th century. Japan was isolated from the world with its ongoing traditions and forms of centralised government. Russia featured a more strong centralised government under the emperor.

Both would soon discover that westernisation and industrialism were expanding and their own ways would not hold up against the new changing world of industrialisation. In the late 19th century the requirement for them to begin industrialising would become even more prevalent for the success of their nation in this new, growing society.

Social consequences

Urbanisation

The concentration of labour into factories has brought about the rise of large towns to serve and house the factory workers.

Exploitation

Workers have to leave their family in order to come to work in the towns and cities where the industries are found.

Change to family structure

The family structure changes with industrialisation. The sociologist Talcott Parsons noted that in pre-industrial societies there is an extended family structure spanning many generations who probably remained in the same location for generations. In industrialised societies the nuclear family, consisting of only of parents and their growing children, predominates. Families and children reaching adulthood are more mobile and tend to relocate to where jobs exist. Extended family bonds become more tenuous.^[23]

Current situation

GDP composition of sector and labour force by occupation. The green, red, and blue components of the colours of the countries represent the percentages for the agriculture, industry, and services sectors, respectively.

Currently the "international development community" (World Bank, Organisation for Economic Co-Operation and Development (OECD), many United Nations departments, and some other organisations)^{[citation needed]} endorses development policies like water purification or primary education^{[citation needed]} and Co-Operation amongst third world communities.^[24] There are members of the Economic communities who don't believe in recognising that contemporary industrialisation policies as being adequate to the global south (Third World countries) or beneficial in the longer term, with the perception that it could only create inefficient local industries unable to compete in the free-trade dominated political order which it has created.^{[citation needed]}

The relationship between economic growth, employment and poverty reduction is complex. Higher productivity is argued to be leading to lower employment (see jobless recovery).^[25] There are differences across sectors, whereby manufacturing is less able than the tertiary sector to accommodate both increased productivity and employment opportunities; over 40% of the world's employees are "working poor" whose incomes fail to keep themselves and their families above the $2 a day poverty line.^[25] There is also a phenomenon of deindustrialisation, such as in the former USSR countries' transition to market economies, and the agriculture sector often is the key sector in absorbing the resultant unemployment.^[25]

See also

• Automation
• Working time
• Division of labour
• Deindustrialisation
• Newly industrialised country
• Urbanisation
• Idea of Progress

References

Further reading

• Hewitt, T., Johnson, H. and Wield, D. (Eds) (1992) industrialisation and Development, Oxford University Press: Oxford.
• Hobsbawm, Eric (1962): The Age of Revolution. Abacus.
• Kiely, R (1998) industrialisation and Development: A comparative analysis, UCL Press:London.
• Pomeranz, Ken (2001)The Great Divergence: China, Europe and the Making of the Modern World Economy (Princeton Economic History of the Western World) by (Princeton University Press; New Ed edition, 2001)
• Kemp, Tom (1993) Historical Patterns of Industrialisation, Longman: London. ISBN 0-582-09547-6
• Tilly, Richard H.: Industrialization as an Historical Process, European History Online, Mainz: Institute of European History, 2010, retrieved: 29 February 2011.