4/26/2020 Capitalism Industrial Revolution
This is a recurring theme for the, whose founder Professor Klaus Schwab made the term the title of his about the future of capitalism. Schwab believes that, unmanaged, the Fourth Industrial Revolution has the potential to decimate global employment levels through productivity advances inspired by breakthroughs in robotics. Unlike the previous three industrial revolutions – which the professor lists as the transport and mechanical production revolution of the late 18th century; the mass production revolution of the late 19th century; and the computer revolution of the 1960s – Schwab endows the fourth wave of creative disruption with the potential of seeing off mass employment altogether. As a result, capitalists turned to issuing government and worker debt, thereby kicking the contradiction down the road. There were exceptions, however, the most famous of which saw early 20th-century industrialist Henry Ford pay his employees $5 per day, twice the average wage for automakers in 1914.
INDUSTRIAL REVOLUTION AND THE EMERGENCE OF CAPITALISM The Industrial Revolution refers to the greatly increased output of machine-made goods that began in England during the 18th century. Before the Industrial Revolution, people wove textiles by hand.
In his 1926 book Today and Tomorrow, Ford laid bare his reasoning: “The owner, the employees, and the buying public are all one and the same, and unless an industry can so manage itself as to keep wages high and prices low, it destroys itself, for otherwise it limits the number of its customers. One’s own employees ought to be one’s own best customers.”. Incomes could also be increased via more of us owning shares in the companies we work for or buy from.
Such a vision invites more diverse forms of ownership in an economy. This could take the form of a proliferation of cooperatives alongside the requirement that all firms have employee share ownership based on length of tenure as opposed to status in the hierarchy. In parallel, enabling environments across global markets could be configured to support new entrants, help finance SMEs and take down monopolies old and new. But there could be method in the madness, should global policy-makers ever get their collective heads around how the money system actually works. At first glance, paying everyone a basic income would massively increase government debt, leading to an inevitable default. But this wouldn’t necessarily be the case. If a government’s power to issue notes and coins was extended to digital money, then that additional stimulus could enter circulation via the wages of its employees.
This would act to reduce borrowing and tax collection while maintaining purchasing power in the economy. Sadly, most politicians don’t understand that over 95% of money in most countries is now created by private banks, and they fail to see the opportunity of expanding their own fiscal power by in line with the digital age. Governments that did lead on this issue would provide a stimulus for their domestic financial technology start-ups, that would provide wallets and payment services for this new digital cash. Taken as a whole, the options outlined above are tantamount to systemic change to keep pace with the human fallout that Schwab warns could come our way.
This is something that Asian politicians attending the meeting in Tianjin should perhaps be mindful of, given the region’s preeminence as a manufacturing base. In contrast, the economies of Western Europe and North America have been de-industrializing for decades.
For them, outsourcing production to and purchasing goods from lower-wage economies is an established hallmark of modern capitalism.
The Economic effectsUndergirding the development of modern Europe between the 1780s and 1849 was an unprecedented economic transformation that embraced the first stages of the great Industrial Revolution and a still more general expansion of commercial activity. Europeans were initially more impressed by the screaming political news generated by the and ensuing, but in retrospect the economic upheaval, which related in any event to political and diplomatic trends, has proved more fundamental.Major economic change was spurred by western Europe’s tremendous during the late 18th century, extending well into the 19th century itself. Between 1750 and 1800, the populations of major countries increased between 50 and 100 percent, chiefly as a result of the use of new food crops (such as the potato) and a temporary decline in disease. Population growth of this magnitude compelled change. Peasant and artisanal children found their paths to inheritance blocked by sheer numbers and thus had to seek new forms of paying labour. Families of businessmen and landlords also had to innovate to take care of unexpectedly large surviving broods. These pressures occurred in a society already attuned to market transactions, possessed of an active merchant class, and blessed with considerable capital and access to overseas markets as a result of existing dominance in world trade.Heightened commercialization showed in a number of areas.
Vigorous peasants increased their landholdings, often at the expense of their less fortunate neighbours, who swelled the growing ranks of the near-propertyless. These peasants, in turn, produced food for sale in growing urban markets.
Manufacturing soared, as hundreds of thousands of rural producers worked full- or part-time to make thread and cloth, nails and tools under the sponsorship of urban merchants. Craft work in the cities began to shift toward production for distant markets, which encouraged artisan-owners to treat their journeymen less as fellow workers and more as wage labourers.
Europe’s social structure changed toward a basic division, both rural and urban, between owners and nonowners. Production expanded, leading by the end of the 18th century to a first wave of as rural wage earners began to purchase new kinds of commercially produced clothing, while urban middle-class families began to indulge in new tastes, such as uplifting books and educational toys for children. In this an outright industrial revolution took shape, led by, which retained leadership in well past the middle of the 19th century. In 1840, British steam engines were generating 620,000 horsepower out of a European total of 860,000. Nevertheless, though delayed by the of the French Revolution and Napoleonic Wars, many western European nations soon followed suit; thus, by 1860 British steam-generated horsepower made up less than half the European total, with France, Germany, and Belgium gaining ground rapidly. Governments and private worked hard to imitate British technologies after 1820, by which time an intense industrial revolution was taking shape in many parts of western Europe, particularly in coal-rich regions such as Belgium, northern France, and the Ruhr area of Germany.
German production, a mere 40,000 tons in 1825, soared to 150,000 tons a decade later and reached 250,000 tons by the early 1850s. French coal and iron output doubled in the same span—huge changes in national capacities and the material bases of life.Technological change soon spilled over from manufacturing into other areas.
Increased production heightened demands on the system to move raw materials and finished products. Massive road and canal building programs were one response, but also were directly applied as a result of inventions in Britain and the United States. Steam shipping plied major waterways soon after 1800 and by the 1840s spread to oceanic transport. Systems, first developed to haul coal from mines, were developed for intercity transport during the 1820s; the first commercial line opened between Liverpool and Manchester in 1830. During the 1830s local rail networks fanned out in most western European countries, and national systems were planned in the following decade, to be completed by about 1870. In communication, the invention of the telegraph allowed faster exchange of news and commercial information than ever before. New organization of and was intimately linked to the new technologies.
Workers in the industrialized sectors laboured in factories rather than in scattered shops or homes. Steam and required a concentration of labour close to the power source.
Concentration of labour also allowed new and specialization, which increased productivity.The new machinery was expensive, and businessmen setting up even modest factories had to accumulate substantial capital through partnerships, loans from banks, or joint-stock ventures. While relatively small firms still predominated, and managerial were limited save in a few heavy industrial giants, a tendency toward expansion of the business unit was already noteworthy. Commerce was affected in similar ways, for new forms had to be devised to dispose of growing levels of production. Small shops replaced itinerant peddlers in villages and small towns. In Paris, the, introduced in the 1830s, ushered in an age of big business in the trading sector.was a vital result of growing commercialization and new industrial technology. Factory centres such as Manchester grew from villages into of hundreds of thousands in a few short decades.
The percentage of the total population located in cities expanded steadily, and big cities tended to displace more scattered centres in western Europe’s urban map. Rapid city growth produced new hardships, for housing stock and sanitary facilities could not keep pace, though responded, if slowly. Gas lighting improved street conditions in the better neighbourhoods from the 1830s onward, and sanitary reformers pressed for underground sewage systems at about this time. For the better-off, rapid suburban growth allowed some escape from the worst urban miseries.Rural life changed less dramatically. A full-scale technological revolution in the occurred only after the 1850s. Nevertheless, factory-made tools spread widely even before this time, as scythes replaced sickles for harvesting, allowing a substantial improvement in productivity. Larger estates, particularly in commercially minded Britain, began to introduce newer equipment, such as seed drills for planting.
Crop rotation, involving the use of nitrogen-fixing plants, displaced the age-old practice of leaving some land fallow, while better seeds and livestock and, from the 1830s, chemical fertilizers improved yields as well. Rising agricultural production and market specialization were central to the growth of cities and factories.The speed of western Europe’s Industrial Revolution should not be exaggerated. By 1850 in Britain, far and away the leader still, only half the total population lived in cities, and there were as many urban craft producers as there were factory hands. Relatively traditional economic sectors, in other words, did not disappear and even expanded in response to new needs for housing construction or food production. Nevertheless, the new economic sectors grew most rapidly, and even other branches displayed important new features as part of the general process of commercialization.Geographic disparities complicate the picture as well. Belgium and, from the 1840s, many of the German states were well launched on an industrial revolution that brought them steadily closer to British levels.
France, poorer in coal, concentrated somewhat more on increasing production in craft sectors, converting furniture making, for example, from an artistic endeavour to standardized output in advance of outright factory forms. Scandinavia and the Netherlands joined the industrial parade seriously only after 1850.Southern and eastern Europe, while importing a few model factories and setting up some local rail lines, generally operated in a different economic orbit. City growth and technological change were both modest until much later in the 19th century, save in pockets of northern Italy and northern Spain. In eastern areas, western Europe’s industrialization had its greatest impact in encouraging growing conversion to market agriculture, as Russia, Poland, and Hungary responded to grain import needs, particularly in the. As in eastern Prussia, the temptation was to impose new obligations on peasant serfs labouring on large estates, increasing the work requirements in order to meet export possibilities without fundamental technical change and without challenging the hold of the landlord class.
Comments are closed.
|
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |