Industrialization

One indicates by industrialization the manufacturing process modern of manufactured goods with techniques allowing a strong labor productivity and which gathers the workers in a place closed with fixed hours and a strict regulation.

Industrialization is a process which upsets the techniques of production: one passes from a system artisanal, manual, of production, in dispersed places, with a production resorting more and more to an energy coming from machines, mass production, centralized, using standards or standards in order to obtain products of a homogeneous quality. The passage of a house work to a more and more specialized work changes the lifestyles radically. It however does not touch all the European countries and its own development differs in the affected regions.

Industrial revolution and industrialization

Industrialization and growth

Industrialization, slow and continuous process

Industrialization begins in Great Britain in the decades 1770 - 1780, with the recourse to the steam engines, supplied with the Houille which replaces the Charcoal, whose production is insufficient (what perhaps historically represents the first Crise of energy). It is propagated in Western Europe starting from 1820. This process was not possible that thanks to the agricultural Révolution of the XVIIIe century.

The France returns there according to the same methods in 1820 - 1830 with the generalization of the weaving looms and the construction of the first ways of Railroad under Louis-Philippe. The development of manufactures at the beginning of the 18th century constitutes the true first Industrial revolution in France, with all the characteristics of the Capitalisme French.

Then towards 1870, arrive the Germany and the the United States, which compete with France and the United Kingdom. As of 1890, one attends the rise of the Russia and the Japan.

In front of this slow diffusion and also its perenniality, historians prefer today the term of industrial age with that of revolution.

Acceleration of the growth and slow progress of the standard of living

This situation is due to two industrial projections:

1) first advanced is founded on an hegemonic energy source: the coal, a basic material: the Iron, and a universal engine: the machine with vapor, this Triptych being put at the service primarily field of the Textile , then Railroad (Years 1830).

the railroad constitutes with him only an major advance since this sector-key will allow a redefinition of the organization of the territory: it will feed the process of industrialization throughout the 19th century by allowing a widening of the markets, by exposing regional industries to an inciting national competition, and by stimulating the dynamics of the Innovation (in the creation of ways, stations, bridges, indication…).

2) the second considerable advance is characterized by the progressive appearance of a new energy source (electricity), new materials derived from iron (Acier S special, Aluminum) whereas new industries emergent (heavy industry, Chimie) (Années 1870), and that, later, the Automobile will appear (Années 1890).

It is only gradually that the projections of industry are made feel on the standard of living of the majority. However, between 1850 and 1914, the annual salary of the workmen will have doubled.

These projections have consequences on the daily life (Transport S, electricity), and the World Fairs are the windows of technological advances and industrial of each country (it is the case for the Eiffel Tower with the exposure of 1889 in Paris, in France).

The manufacture of new products requires a reorganization of the companies.

Constitutions of the companies and birth of the organization of work

The company increases its capital and increases

The companies seek investors, the joint stock companies gradually develop starting from the Années 1860 and are sold in purse: it is the expansion of the Capitalisme.

It is an economic system resting on the private property of the means of production (factories, machines) and whose detention of the capital is source of revenue. There is concentration:

horizontal: one specializes on an principal activity (all the companies manufacturing the same product gather)
vertical: one gathers companies along a line production (concentration in only one group of the company of extraction of the raw materials to the distributers, while passing by the transformation units and the transport infrastructures).

According to the country, these concentrations take different forms:

the Trust: in fact companies manufacture the same product, and which get along on the prices and the produced quantity. The trust develops particularly in Germany and is known under the name of Konzern
the trust: by the concentration, a dominant position is ensured on a sector of the economy. It is in the United States that will be born the largest trusts, as attests some illustrates it example of the Standard Oil founded by John Davison Rockefeller in the years 1870, and who will ensure a time a seizure on the worldwide market of oil. Contrary at the German State, the American State, in the name of free-competition, will seek to limit the emergence of these great monopolistic groups, with measurements antitrust like the Clayton Act (1914) or the Loi Sherman (1890), but without real success.

The company reorganizes

It is the Scientific management. First of all the Taylorism: it aims at improving the manpower productivity with work methods, by separating the tasks from design and manufacture. The tasks are cut out, it is the assembly line work; more monitoring, less dawdlings. It is also the beginning of the Stress.

The Taylorisme is improved in particular by the Fordisme: the workman does not move any more to the part, it is the part which moves to the workman, it is the rise of mechanization, the standardization and the splitting up of work: economies of scale. That allows a large-scale use of workmen. Ford wants to make a single model, the Ford T, of this fact it is less expensive. It is the entry in the Consumer society and the rise of the factories, but work with the workshop and the residence always exists. Henry Ford applies Taylorism but not only, it also applies its policy of high wages in the idea that a workman is potential customers.

The commercial revolution

There are two scales:

the international one, with the rise of the exchanges maritime, railway, competition and the free trade.
the main road, develop the chain stores: they are gigantic, there are a large staff, the windows, the prices are posted, that is done within a luxurious framework. It is the beginning of the Publicité with the Cinéma, that requires more treasury, more finances, there is a development of the Banque S. Thanks to the saving of the private individuals, the companies are financed better, that supports industrialization.

Crises and depressions

Crises and depressions mark out the industrialization of the world.

The crisis is a strong rupture of the economic conjuncture, which marks the one period end of expansion. The depression is a general fall of the prices and production.

The most reported crisis Industrial revolution is undoubtedly that which extended from 1873 with 1896: it is called the Great depression. This Great depression marking the difficult passage towards a second Industrial revolution (founded on the Heavy industry, chemistry, then electricity and the car) should not be confused with the Grande depression of the Années 1930, which is not other than celebrates it crisis of 1929. The crisis of 1873 is due to the scarcity of gold (Vienna Stock Exchange).

Kondratiev highlights the existence of business cycles to which its name remains attached.

Crisis of 1929

See also: Crash of 1929

The crisis of 1929 constituted a true cataclysm for the liberal economy because of its width and its exceptional duration, ignored at the 19th century. Contrary to the former crises, considered as " crises of croissance" alternating with phases of real prosperity, it was grafted on a stagnation which lasted since 1921. It placed the capitalist mode in front of difficulties such as it could survive only while being deeply reformed. One can see there an essential rupture with an economic order and social secular whose two pillars crumbled brutally: commercial freedom and domination of gold within the framework of the system international currency of the Gold Standard.

However, ten years after a war which seemed to have condemned the world to a general impoverishment, optimism carried it in a world which was begun again to dream of economy without crisis, as the euphoria of the Twenties attests it, " the Mad years ".

However, certain wheels of the economic mechanism were enroués for the period, which ended up leading the whole world to the crisis:

the international migrations, factor of balancing, are more and more slowed down by the New Pays S and the the United States (laws on the quotas of 1921 and 1924)
the international business meets obstacles: temptations Protectionist S, economic nationalism, change structural of KNOWN AS, International Division of Work (Europe is not any more the only factory of the world).
the operation of the international credit becomes less easy because New York, new creditor of weight, does not have the traditions of London or of Paris and directs itself more towards its interior market; moreover, the movements of capital become more speculative (see Spéculation), therefore disturbing (pregnancy of the short-term placements)
a worrying movement characterizes the relationship between the farm prices which drop and the industrial prices which increase (Crise of the scissors)
a multiplication of the trusts in industry, sign of one tendency to Surproduction
a job market " encombré" into full " prospérité" , which causes a denunciation of the technological unemployment due to too fast technological advances.

But the first really convincing demonstration of the crisis intervened only in October 1929 following the stock exchange Krach of Wall Street, with the slump in prices of the actions out of purse (the Black Thursday ), which puts an end has a speculative boom: the Dow Jones had passed from index 100 in 1926 to 216 in 1929.

the United States which had many funds in the banks European (especially Austrian) adopts protectionist measures and repatriates their funds. This repatriation causes a banking crisis in Europe. This one will cause an economic crisis and social. The purchasing power of Europeans falls, they consume less and do not import any more (Brazil-coffee,…)

As of the first signs of stock exchange bending, the banks restricted their appropriations and discovered in order to face the difficulties (risk of massive withdrawals of the deposits, losses of money). The range of this restriction is capital for the real economy which was supported by the credit, and this more especially as the companies had engaged their treasury in the speculation.

The extent and the depth of the crisis are without similar, since the crisis is universal, and that appears through three forms:

no economic sector is saved, the crisis being at the same time financial, commercial, industrial, agricultural
no social sector does not escape to him, contrary to the former crises where only the workmen and their employers were touched; in 1929, all the classes are struck, including the shareholders and the civils servant
all the countries are reached, except the USSR which lives in isolation and only one weak echo of the world-wide crisis

perceives

The capitalist system is shaken by the crisis, in particular by the means of the financial phenomena, when the United States repatriates their assets abroad. The most touched countries are those of Central and Eastern Europe, Austria being touched the first, panic developing in Germany before being propagated in Romania and Hungary. The United Kingdom is then touched by the German rout which pushes the German government to freeze the British capital placed to Germany; the British crisis is reflected in the British Empire and in Latin America. France was touched only in 1932 thanks to its more solid banking situation and with its more agricultural character.

The prices crumble, the world exchanges move back (less 30% in volume of 1929 to 1933), the trade deficits are less and less compensated by the invisible incomes (financial), the international credit is paralyzed and the monetary order world is demolished. Social misery results by the ruin of many companies (bankruptcies banking, industrial and commercial) and in working misery (lowers real wages, dramatic Chômage - up to 25% of the credits in the United States).

To find solutions new with a new crisis, the Interventionnisme develops in all the countries in parallel with the ideas of John Maynard Keynes (the " revolution keynésienne". Seeking to start again the purchasing power more than the profits of the companies, it helped to make start again the economy on new bases until in the years 1970/1980.

Various cycles

The growth at the 19th century and the 20th century is irregular, it is marked by cycles of Juglar (cycles short from 6 to 11 years), imbricated in cycles longer, said Kondratieff (from 20 to 25 years) and generally marked by two phases:

a phase of growth (A) 1848 - 1873 then of recession (B) 1873 - 1896 (Great Depression)
then, again, a phase (A) 1897 - 1920 and a phase (B) 1921 - 1939

The crises tended, throughout the XXe century, rather to lead to a questioning of the Libéralisme. Following the crisis of 1929, the measurements taken by Roosevelt US president within the framework of the New Deal echo the theories of John Maynard Keynes. But since the years 1970, under the influence of the economists of the school of Chicago, like Milton Friedman, the crisis leads on the contrary to a general progression of liberalism, by the means of national policies (Ronald Reagan, Margaret Thatcher), or international: General Agreement on Tariffs and Trade (GATT), World Trade organization (OMC).

External bonds

Texts on the Industrial revolution
the Industrial revolution in the Tarn, an article of the site of the Academy of Toulouse
the Industrial revolution

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