Industrialization and
Global Capitalism
Life before the Industrial Revolution
• After the Revolutions in America, France, and
Latin America changed the way government
worked, the Industrial Revolution changed the
way people did work.
• This begs the question “If this changed the
way people worked…How did they work
before the Industrial Revolution?”
Industrialization fundamentally
changed how goods were
produced
Industrial Revolution
• Period from 1750 to 1850 where changes in
agriculture, manufacturing, mining,
transportation, and technology had a
profound effect on the social, economic and
cultural conditions of the times.
• It began in the United Kingdom, then
subsequently spread throughout Western
Europe, North America, Japan, and eventually
the rest of the world.
Why Great Britain
Why did the most important economic change since the Agricultural
revolution begin on this Island?
Why Britain – One More Time
• Europe’s location on the Atlantic Ocean
• The geographical distribution of coal, iron and
timber
• European demographic changes
• Urbanization
• Improved agricultural productivity
• Legal protection of private property
• An abundance of rivers and canals
• Access to foreign resources
• The accumulation of capital
Industrial Revolution Essentials
• Origin in England, because of its natural
resources like coal, iron ore, and the invention
and improvement of the steam engine
• Spread to Europe and the United States
• Role of cotton textile, iron, and steel industries
• Relationship to the British Enclosure Movement
• Rise of the factory system and demise of cottage
industries
• Rising economic powers that wanted to control
raw materials and markets throughout the world
Innovation Spurs Progress
Technological advances that produced
the Industrial Revolution
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James Hargreaves - Spinning jenny
James Watt—Steam engine
Eli Whitney—Cotton gin
Henry Bessemer—Process for making steel
Watt’s Steam Engine
Internal Combustion Engine
Advancements in science and
medicine
• Edward Jenner—Developed smallpox
vaccination
• Louis Pasteur—Discovered bacteria
Enter the Factory
Production is centralized into one building
• Industrial Factory – Chief means of organizing
labor around the new machines
Impacts of the Industrial Revolution
on industrialized countries
• Population increase
• Increased standards of living for many, though not
all
• Improved transportation
• Urbanization
• Environmental pollution
• Increased education
• Dissatisfaction of working class with working
conditions
• Growth of the middle class
The nature of work in the factory
system
• Family-based cottage industries displaced by the
factory system
• Harsh working conditions with men competing with
women and children for wages
• Child labor that kept costs of production low and
profits high
• Owners of mines and factories who exercised
considerable control over the lives of their laborers
• The development of the factory system concentrated
labor in a single location and led to an increasing
degree of specialization of labor
Second Industrial Revolution
• As the new methods of industrial production
became more common in parts of
northwestern Europe, they spread to other
parts of Europe and the United States, Russia,
and Japan
• The “second Industrial revolution” led to new
methods in the production of steel,
chemicals, electricity and precision machinery
during the second half of the nineteenth
century.
New patterns of global trade and
production developed and further
integrated the global economy as
industrialists sought raw materials
and new markets for the
increasing amount and array of
goods produced in their factories
• The need for raw materials for the factories and increased food
supplies for the growing population in urban centers led to the
growth of export economies around the world that specialized in
mass producing single natural resources
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Cotton
Rubber
Palm oil
Sugar
Wheat
Meat
Guano
Metals
Minerals
The profits from these raw materials were used to purchase finished
goods
Industrial Impact Abroad
• The rapid development of industrial production
contributed to the decline of economically
productive, agriculturally based economies
– Textile industry in India
• The rapid increases in productivity caused by
industrial production encouraged industrialized
states to seek out new consumer markets
– British and French attempts to "open up" Chinese
markets during the nineteenth century for their
finished goods.
Need…
• The need for specialized and limited metals
for industrial production, as well as the global
demand for gold, silver and diamonds as
forms of wealth, led to the development of
extensive mining centers
– Copper in Mexico
– Gold and diamonds in South Africa
To facilitate investments at all
levels of industrial production,
financiers developed and
expanded various financial
institutions
Capitalism
• The ideological inspiration for economic
changes lies in the development of capitalism
and classical liberalism associated with Adam
Smith and John Stuart Mill
Financial Instruments
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Stock markets
Insurance
Gold Standard
Limited Liability Corporations
Large-scale Transnational Businesses
• The global nature of trade and production
contributed to the proliferation of large-scale
transnational businesses
– United Fruit Company,
– The HSBC- Hong Kong and Shanghai Banking
Corporation
There were major developments
in transportation and
communication
Developments in Transportation and
Communication
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Railroads
Steamships
Telegraphs
Canals
The development and spread of
global capitalism led to a
variety of responses
Impact of the Industrial Revolution on
slavery
• The cotton gin increased demand for slave
labor on American plantations.
• The United States and Britain outlawed the
slave trade and then slavery.
Social effects and Reforms of the
Industrial Revolution
• Women and children entering the workplace
as cheap labor
• Introduction of reforms to end child labor
• Expansion of public education
• State pensions and public health (Germany)
• Increased male suffrage (Britain)
• Women’s increased demands for suffrage
Child Labor
The rise of labor unions
• Encouraged worker-organized strikes to
increase wages and improve working
conditions
• Lobbied for laws to improve the lives of
workers, including women and children
• Wanted worker rights and collective
bargaining between labor and management
Capitalism
• Adam Smith’s Wealth of Nations
• Role of market competition and
entrepreneurial abilities
• Impact on standard of living and the growth of
the middle class
• Dissatisfaction with poor working conditions
and the unequal distribution of wealth in
society
• In industrialized states, many workers
organized themselves to improve working
conditions, limit hours, and gain higher wages,
while others opposed capitalist exploitation of
workers by promoting alternative visions
Utopian Socialism
• Exemplified by the work of Henri de SaintSimon, Charles Fourier, and Robert Owen
• Inspired Karl Marx and other early socialists
• Generally don't feel class struggle or political
revolutions are necessary to implement their
ideas; that people of all classes might
voluntarily adopt their plan for society if it
were presented convincingly
Socialism and communism
• Karl Marx’s Communist Manifesto (written
with Friedrich Engels) and Das Capital
• Response to the injustices of capitalism
• Importance of redistribution of wealth to the
communists
Other Responses
• In Qing China and the Ottoman Empire, some
members of the government resisted
economic change and attempted to maintain
preindustrial forms of economic production
– China’s Self-Strengthening Movement
• In a small number of states, governments
promoted their own state-sponsored visions
of industrialization
– Economic reforms of Meiji Japan
– Developments of factories and railroads in Czarist
Russia
– Muhammad Ali’s development of cotton textile
industry in Egypt
The ways in which people
organized themselves into
societies also underwent
significant transformations in
industrialized states due to the
fundamental restructuring of the
global economy
• New social class, including the middle class
and the industrial working class developed
• Family dynamics, gender roles, and
demographics changed in response to
urbanization
• Rapid urbanization that accompanied global
capitalism often led to unsanitary conditions
as well as to new forms of community
– Tenement housing
Final Thoughts
• Industrialization fundamentally altered the
production of goods around the world.
• It not only changed how goods were produced
and consumed, as well as what was considered a
“good,” but it also had far-reaching effects on the
global economy, social relations, and culture.
• Although it is common to speak of an “Industrial
Revolution,” the process of industrialization was
a gradual one that unfolded over the course of
the eighteenth and nineteenth centuries,
eventually becoming global.