History of Industrial Revolution
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8/3/2019 History of Industrial Revolution
History of Industrial Revolution.
The Industrial Revolution was a period from the 18th to the 19th century where major changesin agriculture, manufacturing, mining, transportation, and technology had a profound effect on
the socioeconomic and cultural conditions of the times. It began in the United Kingdom, thensubsequently spread throughout Europe, North America, and eventually the world.
The Industrial Revolution marks a major turning point in human history; almost every aspect ofdaily life was influenced in some way. Most notably, average income and population began toexhibit unprecedented sustained growth. In the two centuries following 1800, the world's averageper capita income increased over 10-fold, while the world's population increased over 6-fold. Inthe words of Nobel Prize winner Robert E. Lucas, Jr., "For the first time in history, the livingstandards of the masses of ordinary people have begun to undergo sustained growth. ... Nothingremotely like this economic behavior has happened before.
Starting in the later part of the 18th century, there began a transition in parts of Great Britain'spreviously manual labor and draft-animalbased economy towards machine-basedmanufacturing. It started with the mechanization of the textile industries, the development ofiron-making techniques and the increased use of refined coal. Trade expansion was enabled bythe introduction of canals, improved roads and railways.
The introduction of steam power fuelled primarily by coal, wider utilization of water wheels andpowered machinery (mainly in textile manufacturing) underpinned the dramatic increases inproduction capacity. The development of all-metal machine tools in the first two decades of the19th century facilitated the manufacture of more production machines for manufacturing in otherindustries. The effects spread throughout Western Europe and North America during the 19th
century, eventually affecting most of the world, a process that continues as industrialization. Theimpact of this change on society was enormous.
The first Industrial Revolution, which began in the 18th century, merged into the SecondIndustrial Revolution around 1850, when technological and economic progress gainedmomentum with the development of steam-powered ships, railways, and later in the 19th centurywith the internal combustion engine and electrical power generation. The period of time coveredby the Industrial Revolution varies with different historians. Eric Hobsbawm held that it 'brokeout' in Britain in the 1780s and was not fully felt until the 1830s or 1840s, while T. S. Ashtonheld that it occurred roughly between 1760 and 1830.
Some 20th century historians such as John Clapham and Nicholas Crafts have argued that theprocess of economic and social change took place gradually and the term revolution is amisnomer. This is still a subject of debate among historians. GDP per capita was broadly stablebefore the Industrial Revolution and the emergence of the modern capitalist economy. TheIndustrial Revolution began an era of per-capita economic growth in capitalist economies.Economic historians are in agreement that the onset of the Industrial Revolution is the mostimportant event in the history of humanity since the domestication of animals and plants.
8/3/2019 History of Industrial Revolution
Industrial Development and Economic Growth:
1. IntroductionThe share of poor people in the global population has declined during recent decades. According to Chen andRavallion (2004), one-third of the population of the world lived in poverty in 1981, whereas the share was 18
per cent in 2001. The decline is largely due to rapid economic growth in populationrich countries like Chinaand India. There are, however, remarkable differences between countries and between regions in thedeveloping world. Some regions and countries, notably in East Asia, are rapidly catching up to industrializedcountries. Others, especially in Sub-Saharan Africa, are lagging far behind and the share of poor people in the
population has even increased in some countries. Industrial development has had an important role in theeconomic growth of countries like China, the Republic of Korea (Korea), Taiwan Province of China (Taiwan),and Indonesia. Along with accelerated growth, poverty rates have declined in many countries. Some countrieshave managed to achieve growth with equity, whereas in others inequality has remained high. In this chapter,the growth stories of seven countries China, India, Korea, Taiwan, Indonesia, Mexico and Brazil aredescribed and discussed. The main emphasis is on describing their growth processes and strategies, therole of industrial development, the contribution of a range of policies to growth performance, and the impact ofgrowth on poverty and income inequality. The study begins with a short theoretical discussion of the impact
of industrial development on growth and the impact of growth on poverty and income inequality and thenproceeds to the country examples.
3. Economic growth and the poorRapid economic growth is often essential for achieving a reduction in absolute poverty. As growth may beassociated with increased income inequality, it does not automatically address the whole poverty problem. Thetraditional economic development literature considered highly unequal income and wealth distribution as anecessary condition for continued and rapid economic growth. The basic economic argument to justify largeincome inequalities was that high incomes (personal and corporate) were a necessary condition for highersavings, which in turn were needed for investment and economic growth (Todaro, 1994).
5. Industrialization, economic growth, poverty and inequality:Country examples
5.1 ChinaAfter World War II, China adopted a development strategy that included deliberate insulation from the worldeconomy, industrialization and economic dominance of the state. As the country was falling far behindWestern countries, however, it began reforming its closed and centrally planned economy in 1978. Sincereforms, growth has accelerated and in the 1980s and 1990s GDP growth rates were the highest in the world,9.9 per cent and 10.3 per cent respectively, up from 6 per cent in the 1970s (World Bank, 2004a). Growth has
been especially high in industry, the compound annual growth rates being 11.3 per cent between 1980 and2002, with services also growing fast (10.4 per cent). The share of industry in GDP has increased from 35 percent in 1965 to 46 per cent in 2004.
5.2 IndiaThe economic development strategy that India chose after the Second World War was very similar to Chinas
near autarky, industrialization and the dominance of the state in the economy. Development was considered
synonymous with industrialization and industry was concentrating mainly on basic goods like steel andmachinery. Private capital was not seen as an efficient motor for development, and it was considered to have atendency towards monopolization. Because of that, state control was considered to be essential. The chosendevelopment strategy was one of import substitution. Development policies included licensing of industrialactivity, the reservation of key areas for state activity, controls over foreign direct investment, andinterventions in the labour market (Kaplinsky, 1997).
5.3 South KoreaEconomic growth in South Korea has been rapid during the last 40-45 years. During its rapid industrialization,the country was able to achieve remarkable growth with steep reductions in poverty and inequality. In 1960-
8/3/2019 History of Industrial Revolution
2002, the compound annual GDP growth rate (CAGR) was 7.5 per cent. Growth has been high especially inmanufacturing. Between 1960 and 1969, the CAGR of manufacturing value added was 16.5 per cent and
between 1970 and 1979 it was 17.6 per cent. Growth in agricultures value-added has been continuouslydeclining, falling from 5.1 per cent in the 1960s to only 1.7 per cent during 1990-2002. Rapid growth has beenassociated with significant structural changes (Figure 5). In 1965, the share of manufacturing in GDPwas 14 per cent and that of agriculture 39 per cent.
5.4 Taiwan Province of ChinaLike Korea, Taiwan has experienced rapid economic growth over the past half century. The average annualgrowth rate during that period has been 8.4 per cent, reaching almost 10 per cent in the 1960s and 1970s(Liang and Mei, 2005). Economic growth has been heavily based on the growth of manufacturing,and from the 1960s onwards on export-orientation. At the outset, the country specialized in labour-intensive
production and later shifted towards capital-intensive and high-tech production.
Need of Industralization in Pakistan.
During the early twentieth century, the Muslims of the subcontinent were under the proverbial
thumb screws, victims of the merciless oppression of the British Empire. A dark time indeed foranyone who declared faith in Islam. But its not wise to wound, what you cant kill. Like acompressed spring, the Muslim Nation rose as one, united under the banner of Allah. Under theleadership of Jinnah, the Muslims found new faith. Faith in the Almighty, faith in their owncapabilities, faith in their ideologyThe movement led to the birth of a new nation and the dawning of a new era in the subcontinent.On 14th August, 1947, Pakistan appeared on the face of Gods green Earth, a dream made intoreality even in the face of insurmountable odds. The Muslims achieved more than just a strip ofland. They regained their identity, which had been lost over the decades of foreign rule. Our forefathers, proved once again the age old saying of champions:
Everything is possible. The impossible just takes long