ADV INFO Economic Developments 1886-1914 Flashcards
When is the start of the great depression normally placed
1873
when was the great depression still in effect
1886
what was set up to investigate the depression
a royal commission
what had Britain lost in the period
it world-leading economic position
What were many British firms experience
decline profits and they, therefore, invented less
what was British industry made up of
smaller family firms rather than the much larger firms in the USA and Germany, so their capacity to invest was hit harder by the drop in profits.
what did the lack of investment lead to
a degree of stagnation in British Industry
what happened to the export values of the early 1870s
they were not exceeded until the late 1890s
what happened to cotton goods exports
the number in 1872 was not equalled until 1904, the worst year for the export of cotton goods being 1895
what was imposed on British goods from the 1860s
tariffs,
what did the tariffs placed on British goods do
in the short term, they made British exports more expensive than the goods produced within the importing country, which reduced demand for British goods; the tariffs would also allow the native industry to grow and invest, enabling them to compete with British produced goods in the long term
what was productivity like in Britain
it was lower than in the USA and Germany
what contributed to Britain’s poor productivity
the poverty and poor health of the British working class; limited levels of investment in new technologies; British capital being invested abroad rather than at home; costs of transportation within Britain; and comparatively poor levels of scientific and technological education
what were the statistics of productivity in 1913
Germany produced six times more science graduates than Britain
What had happened to the American and German economies at the time
they were growing at twice the rate of the British economy
what happened to the price of textiles during the period
they dropped by 30%
what would also suggest that the British economy was depressed
imports were not increasing at the same rate during the Great Depression as they had done previously
what had Britain done that disadvantaged domestic goods
they did not impose tariffs, so the imported goods were often cheap, most notably food products.
why was the demand not strong
due to unemployment and stagnant wages levels
what was starting to emerge during the Great Depression
a growing deficit in the visible balance of trade
what did agriculture struggle against
foreign imports
What areas continued to grow slowly
overall levels of production and the volume of exports continued to rise in most industries through the period of the Great Depression
what position was Britain still in 1896
it was still one of the world’s leading economies.
what had the city of London become
a world leader in financial services
where did British entrepreneurial efforts shift
from traditional industry, which was beset with falling prices and competition, to the service sector and commerce, areas in which Britain excelled.
what did the level of invisible exports do
more than offset the deficit in the visible balance of trade and Britain’s overall balance of trade remained positive
what is a balance of trade
the value of exports minus the value of imports. The visible balance of trade is based on the value of physical goods being exported and imported. The overall balance of trade is also affected by ‘invisible’ imports and exports: services and non-physical goods, such as city financial services for foreign firms
how did the working classes benefit from the depression
falling food prices increased ‘real wages’ and improved the standard of living of many in the working classes
which historians dismissed the whole idea of the Great Depression
S.B. Saul
what happened to GDP suggests that the British economy was still functioning effectively
between 1900 and 1913 GDP increased on average by 1.7% a year.
what happened to output from the staple industries
they continued to increase output
what happened to coal production during the period
increased from 223 million tons in 1900 to 287 million tons in 1913
what happened to British dominance in shipbuilding
60% of the world’s merchant ships were being built in British shipyards
What happened to British foreign investment
went from £50 million in 1901 to £200 million in 1913
what was unclear about Britain’s economic position
it was unclear whether Britain would be able to maintain its strong position in world markets in the staple industries
which books emphasised the point that Britain was no longer the workshop of the world
Made in Germany and American Invaders
what did people turn to explain issues
the writings of social-Darwinists such as Galton
what did Galton speak fo
physical deterioration
what was physical deterioration
the idea that there was a genetic decline in the British race
what is eugenics
the idea that society could be improved through promoting selective breeding and even sterilisation of some members of society
what exposed the terrible poverty that existed in Britain
the recruitment drive for the Boer War and reports by Seebohm Rowntree and William Booth
what did the work of Rowntree and Booth question
whether the British worker could, in the long term, compete with the seemingly healthier and better educated German and American workers
what happened to Britain’s share of world manufacturing
it continued to fall even after the Great Depression ended
how could it be suggested that the decline was comparatively not real
the British economy continued to grow and so did British production
what per cent of the world’s goods were produced in Britain in 1870
33%
what per cent of the world’s goods were produced in Britain in 1913
14%
what per cent of the world’s goods were produced in Germany and the USA in 1913
35 % - USA
16% - Germany
why was it expected that Britain would have a slower growth rate than the newly emerging economies
it had started from a higher base
what had happened to British industrialists
they were less dynamic and less flexible
why were cost-saving methods like the Ford Conveyor belt not adopted in Britain
they had more skilled craftsmen than the USA
how was Germany more advanced
they were ahead in terms of technical and managerial education
what was the ‘early start’ thesis
the country that industrialises first faces a long term disadvantage, as techniques and processes become outdated and the initial advantage is lost. Late starters can adopt recent techniques and equipment and learn from the experience of the initiator.
what is an example of the early start thesis
Introducing electricity to the British cotton industry, for example, would have required redesigning the weaving sheds, while in the USA the whole production process could be put into place in one go. In the steel industry in the 1860s, Britain, the USA and Germany were all using the same British equipment. The other two updated their technology, but Britain stuck with the older, less efficient methods.
How can declining demand abroad explain economic problems in Britain
other countries developed their own raw materials and manufacturing, so Britain was no longer the workshop of the world. Germany, the USA and other countries were now exploiting their own natural resources, which reduced British exports
What happened to British exports between 1899 and 1913
they increased by 3%
what happened to the total value of British exports
1840-49 - £124.5 million
1860-69 - £159.7 million
1870-79 - £218.1 million
how could low wages explain Britain’s relative economic decline
it suppressed British demand for manufactured goods.
how did wages compare in other countries compared to Britain
in the USA workers received higher pay and so generated demand
where was manufacturing focused
on high-quality goods aimed at the aristocracy rather than targeting the mass market with cheaper goods produced on production lines
why was Britain at a disadvantage based on supply-side factors
in the USA, the shortage of skilled labour forced the industry to develop labour-saving machinery; in 1910, US textiles and tinplate industries produced the same amount as Britain with about 25% of the workforce. Britain had no need to develop efficiency in terms of labour or fuel
what did the firms in Britain focus on
profits, not long term reinvestment
how did British firms preserve profits
by cutting wages rather than investing in technology, moving to mass production, and developing better management techniques and integration.
Who took mass retailing to a new scale
Thomas Lipton and JJ Sainsbury
what did Thomas Lipton do
he founded his first shop in 1872 and by 1898 had 242 branches, factories and overseas agencies
what did Jesse Boot do
he was transforming the economics of chemists, with stores for the middle classes
what decline more sharply than the British industry
British agricultural
why were thousands of agricultural workers laid off
cheap imported cereals
what happened to the amount of land used for growing cereal crops
1872 - 9.6 million acres
1913 - 6.5 million acres
what happened to the land not being used to grow cereal crops
it was turned over to pasture and so improved the supply of British meat and dairy products, where farmers were better protected from cheap foreign imports because mil could not be imported efficiently
why did people prefer each domestic British farm meat
it was of better quality and many preferred to eat fresh, rather than frozen, meat
how were livestock farmers boosted
the low price of animal feed
what happened to the number of livestock in Britain
it increased during this period and areas such as Lancashire and the West Country saw significant increases in the numbers of cattle and pigs
what did a loss of income in agriculture lead to
a lack of maintenance of farmland
stagnant wages for labourers; a shrinking workforce
fields being left to become a rough pasture
what was developed in response to the pressure to save labour costs
new technology, such as a self-binding reaper and a new plough
where were there additional developments made in agriculture
in scientific approaches and courses on farming and breeding livestock
why were dairy farmers in a much better position than other farmers in other sectors
the rising disposable income of the urban workers with the demand for dairy products
what happened to agricultural output after 1900
it increased by 5% between 1900 and 1914
what happened to agricultural prices after 1900
they rose for the first time in almost half a century
what helped protect British farmers
the ban of live cattle imports in 1892
what is the overall conclusion of farming in the period
it would never truly recover to its previous highs
What was Britain over-reliant on
textiles and shipbuilding
what had made Britain particularly vulnerable to changes in the world economy
the exploitation of large export markets
What had happened to the world economy in 1886
other countries were no longer reliant on British exports of coal, iron and steel
what happened to the textile industry in the USA
it used electricity, modern machines, the latest spindles, all of which lowered the cost
what happened to the textile industry in Britain
they preserved older methods, even when 95 new cotton mills were opened between 1905 and 1907
what was coal output like in 1913
only 8% of British coal was cut mechanically in 1913 (over 25% in the USA)
what was Britain slow to adopt
larger, cheaper and more efficient steel processes, sticking with the production of pig iron instead of steel
what advancements were made in shipbuilding
the development of oil-fired turbines that were more efficient than steam turbines.
what made up 50% of all British output
the staples of coal, textiles, iron, steel and engineering
how much of the workforce came from coal, textiles, iron, steel and engineering
25%
what happened to the average imports of raw cotton (kg)
564,269 - 1870-79
845,497 - 1910-19
what happened to the average exports of cotton cloth
3269 - 1870-79
5460 - 1910-19
what happened to the output of coal
1870 - 108.6 million tons
1913 - 282 million tons
what was steel production like in 1913
USA - 13 million
Germany - 7 million
Britain - 5 million
what happened to the value of British exports in iron and steel
1880-89 - £35.3 million
1910-19 - £62.9 million
what happened to the tonnage of ships built and first registered in Britain
1880-89 - 377.2 thousand tons
1900-09 - 674.2 thousand tons
what hampered Britain’s motor car industry
the 1865 red flag act
what did the 1865 red flag act do
limited motorised transport to 4 mph and required a car to be preceded by a person carrying a red flag to warn other road users
when was the 1865 red flag act repealed
1896
how many cars were there in Britain in 1914
132,000 cars
what hand-built cars were there in Britain
the silver ghosts manufactured by Rolls Royce in 1907
what cheaper car was made in the US
the model T Ford (1908)
which firms operated in the bicycle industry
firms such as Humber and Raleigh produced bicycles in large numbers that fed not only the domestic market but also become a highly valuable export
where did Britain fail to compete effectively
the chemical industry
what methods did Britain use in chemicals
the less efficient Le Blanc method to produce soda, while Germany and the USA quickly adopted the new more efficient Solway ammonia process
what was built in 1881
the first power station at Godalming and further power stations were built in large cities
what enabled the production of electricity on a larger scale
the development of the steam turbine
what new industries emerged after the first world war
Vehicles, aircraft, chemicals, electrical equipment, artificial fibres and oil
what does the development of these new industries suggest
that decline was not terminal or permanent and that the issues that the British economy faced from 1886 to 1914 were surmountable
where were huge profits being made
the invisible exports of shipping, trading and financial services, and these more than compensated for any deficit in the balance of visible trade
what had the British pound become
the cornerstone of international trade
what happened to British investment abroad in 1913
it reached £4000 million
what was the combined foreign investment of France, Germany, Belgium, Holland and the USA
£5500 million
what contributed greatly to the level of invisible exports
the British merchant navy
what were the statistics for shipping in 1900
45% of all cargoes entering French ports and 55% of all cargoes entering US ports were carried by British ships
what did British shipping generate from 1911 to 1913
from 1911 to 1913, British shipping generated £100 million per year, 2/3rds of invisible exports, and carried almost all trade between Britain and both Europe and the rest of the world
how were American ships better than British ones
they were more technologically advanced, required fewer sailors and were quicker
what financial markets did Britain dominate
Banking and insurance
who had a monopoly on shipping insurance
Lloyds of London
where did British banks have branches
South America, India, Egypt and Hong Kong
what was the rate of foreign investment
twice as much capital was being invested abroad as was being invested at home in the years 1911 and 1913
what happened to British exports from 1860
they were defended against by tariffs
what had caused a consensus of following free trade
the repeal of the corn laws in the 1840s
how was the cross-party consensus on free trade ended
in 1902 the Conservatives introduced a one-shilling tariff on imported wheat to help pay for the Boar War
how was the consensus destroyed in 1903
the proposals of the Secretary for the Colonies, Joseph Chamberlain, to introduce protectionism
what is protectionism
the policy of a government that ‘protects’ its country’s industry from foreign competition through tariffs, quotas and so on
why was free trade popular
it helped drive down food prices
why did real wages increase
they had had no notable increase in wages, while prices fell by about 25% between 1880 and 1900
how was British agriculture and industry struggle to compete with the USA and Germany
in terms of price
what did the supporters of protectionism say free trade caused
mass unemployment
what did Joseph Chamberlain suggest
a system of imperial preference
what was the imperial preference
this would impose tariffs on goods from outside the British Empire while removing the wheat tariff from imports from the colonies, provided they in turn did not impose tariffs on British goods.
when did Chamberlain suggest his scheme
May 1903 in a speech in Birmingham
what was the issue with making the speech in May 1903
it was on the same day Balfour spoke of scrapping the wheat tariff. The cabinet split, while Balfour failed to act decisively one way or the other
when did Chamberlain resign
September 1903
what did Chamberlain set up
the tariff reform league
