Economic Developments 1851-86; (complete) Flashcards
In what ways did Britain dominate the world economy in the mid 19th century?
-Produced approx over 40% total traded manufactured goods in world
-Approx 25% world’s trade passed through British ports
-Was acknowledged ‘Workshop of the world’ but other countries furnished it with raw materials & foodstuffs
-Great Exhibition 1851; symbol of international economic cooperation, but Britain was ‘taking most of the prizes’ (Peter Mathias)
What was the GB economy like post-Great Exhibition?
-There was a rapid increase in export orders & growth in overseas markets
-1/3 of all GB goods were exported to the British Empire. Many goods went to USA as its own industries were not sufficiently developed to cope with population demands.
-The growth in export trade continued nearly unchallenged for the next 20yrs.
-GB was at the height of its economic & industrial power. It was accompanied by technological developments in coal, iron, steel, textiles, etc.
-There was a boost in agriculture- a period of high farming
-Laissez-faire prevalent in government
Why was economic growth rate slowing down after 1873?
The economy was still growing but at a slower rate
Imports were increasing against exports
GB beginning to face competition from newly industrialised nations like Germany & the USA
Why was Britain considered to be in ‘Golden Age’ of agriculture in the 1850s?
-Harvests produced successive high yields,
-Prices were steady,
-Farmers’ incomes increased
-Scientific & technological improvements being carried out
What was high farming (examples) and how did it contribute to the golden age of agriculture?
New farming practices adopted to get the best out of both land & livestock
-Increased productivity. Farmers moved from arable to mixed farming; hedged bets by growing wheat & root crops and stocking cattle, sheep, pigs. So; they’d be cushioned against a sudden downturn in crop/livestock price.
-Surplus crops fed animals & animal manure fed crops
-Increased interest in stock farming, some specialised in specific cattle breeds
-Much profit from livestock rearing
-Growing animal feedstuff market (made from cotton seed,etc), worth £5m yr by 1870
^Eased pressure on farmers to pursue mixed farming, easier to specialise in mixed/arable.
How were improvements in crop yield made?
Problems of poor drainage met by manufacture of clay pipes- Gov loan schemes for drainage pipe systems
Increase in scientific knowledge= artificial fertiliser rise, e.g superphosphates, industry worth £8m/yr by 1870
^These made substantial improvements to crop yields
Why was the introduction of farming machinery slow & what developments were made?
As there was a ready supply of cheap labour and agricultural labourers amongst most poorly paid
-Widespread use of horse-drawn reaper
-Better ploughs, seed drills & steam-driven machines to improve crop production
Why was there an increase in demand for food/other produce and how was the demand met?
Steady growth of population, rising prosperity, general rise in wages & prices
Demand met by agricultural improvements; railways (food quickly transported), increasing market for fresh produce
How did home farmers and the general public benefit from the golden age of agriculture?
-By early 1870s, farmers made 50% of home wheat consumption, 90% of home meat consumption
-Dairy farmers supplied home market w/ milk, butter, cheese.
-Farmers benefitted from rising produce prices, building large farmhouses w/ huge profits.
-Accessibility of plenty of good, cheap, home-produced food improved health & raised living standards.
Why was the golden age considered ‘lucky’ and what lead to its end?
High yielding harvests of 1850-73 were attributed to a long cycle of fine dry summers
Dry summers ended; rain fell, foreign competition, catastrophic fall in prices
1873- Years of prosperity came to end, farming industry enter period of economic downturn
Why did trade begin to develop?
-GB developed staple steel, coal, iron, textiles, engineering and shipbuilding industries; made 2-3% economic growth rate/year
-Output far beyond home consumption requirement
-Created boom in GB export market, accounted for almost all GB exports due to growing demand for goods
-Profits raised provided capital for more investment at home + overseas.
Which factors contributed to Britain’s economic successes?
-International trade established GB’s relationship with foreign countries, increasing its influence abroad. -Dependence of nation upon nation promoted peace
-Gladstone’s policy of maintaining peace further encouraged economic stability
-Rivals like Prussia and USA were sidetracked by war
-GB’s economic progress was sustained by free trade policy
-Gladstone’s taxation reduction allowed entrepreneurs & businessmen to build up private fortunes& wealth of nation by invest aims large sums of capital into industrial enterprises at home/abroad
Why was there still unemployment and poverty despite the economic prosperity?
Wealth creation was not universal, the cluster of profits created more wealth but it wasn’t distributed evenly
Employment was substantial in all industries but there was still poverty and unemplyment
What were the reasons for Britain’s exceptional industrial progress?
-Was 1st industrial nation, by mid Victorian era far outstripped other countries in establishing home markets & abroad for range of quality products
-Greatest colonial power; controlled vital sea routes
-Plentiful natural resources; coal, iron ore, so forged ahead in design, engineering and production
-GB population rose from 27m to 35m in 1881 (30 yrs) provided large workforce, home market
-Railway network; linked all major towns + sea ports
-Free trade encouraged overseas trading % stimulated industry
What was the rise in coal output from 1850-75 and why did this occur?
1850- output of coal= 50m tonnes
1875- output of coal= 130m tonnes and rising
Drop in coal price & increase in demand= stimulated increased production in mid 19th century, after which industry demanded more coal produced
What developments occurred in iron and steel production?
-Demand for good quality iron increasing
-John Neilson’s hot blast (1827) and James Nasmyth’s steam-hammer (1844) responsible for increase in iron output from 1850 onwards
-Railways, bridges, steam ships, textile machinery, etc all dependent on good quality iron production
-Iron ore production in 1855- 9m tons, 1875- 15m+ tons
-Steel in manufacturing developed in this time; its tougher & more versatile than iron
-In 1860s new processes allowed steel to be made more quickly, cheaply in larger #. By 1870, steel was replacing iron
What were the developments in railway and engineering at this time?
-Further development of important railway industry; expansion of already established network in England, Wales, S Scotland.
-Set up branch lines, linking seaside resorts, etc and helped create new industry of tourism
-Concern with making faster, better engines; led to development of precise engineering
1st London Underground line (The Metropolitan) had 10m passenger at opening in 1863
What developments occurs in shipping?
-GB shipping dominated the world- sailing ships made majority of merchant navy.
-Increase in shipbuilding in 1850s due to growth in world trade + increase in cheap iron, later steel production
-Britain could forge ahead in the development of steam ships and monopolise the shipping routes
-Suez Canal opened in 1869, cut journey time to India- GB benefit due to steam ships fitting
-1850-80 tonnage of GB steam ships went from 319,000 tons to 3m+ tons
What were the improvements in the cotton industry?
-Textile industry centred around cotton & wool production- almost 2/3 GB exports in 1851
-Remained major industry but progress slowed- share of export market fell in 1860s as others (eg steel) rose
-GB manufactured cotton cloth still 2/3 of cotton sold in world markets until 1900
What was economic laissez faire and who supported this?
-Basic principle of Lib govs- that basic economic laws did not change
-So, in an orderly market price would keep supply & demand in equilibrium state; if goods were in short supply & demand was high, prices were high. If goods were in plentiful supply, demand was low, prices would fall. Argument= gov legislation would make no difference
-1776, Adam Smith said that gov intervention in trade would restrict economic development; saying Lasseiz faire economy would bring prosperity and growth. Arguing for free trade.
-Laissez faire was broadly accepted, people had little expectation of gov intervention in economic affairs
-Gladstone was a firm believer in this
What was the policy of free trade, its results and protests to it?
-Gathered strength in 1850s, endorsed by Whigs/libs and Gladstone’s main objective as chancellor
-Lower duties paid by manufacturers= more cheaply made goods; then sold at competitive price at home/abroad market
-Policy led to massive increase in volume of trad, stimulated more economic growth
-1860s- nearly all trade restrictions removed, GB a free trading nation
-By 1880s, protest against free trade gathered, eg Fair Trade League for a more protectionist approach as other countries imposed tariffs on GB goods
Why was there an onset of depression after 1873?
Post 1873, GB economy faced a downturn . May have seemed worse as followed a period of prosperity
-Rate of production in steel, coal and cotton was increasing but more slowly
-Fall in prices (no clear answer why)- smaller profit margins for manufacturers, worker laid off more
-Periods of unemployment but not sustained
Why was there a depression in industry?
-Industry still expanding but at slower rate, capital still invested abroad.
-Production increased but overtook demand (home/overseas); prices fall
-Post 1870= more competition
-Increase in imports over exports, mostly in manufactured goods
-Many manufacturing firms failed to see necessity for change like adding science-based industries & thinking coal and textiles would always make money
-United Germany overtaking GB- better education. (WC British kids left school mostly at age 12)
-USA share in total world manufacture increased while GB fell
Why was there a depression in agriculture?
-Golden age of farming came to abrupt end
-Increasing import of cheaper grains from overseas- USA. 1886; 2/3 wheat consumed imported
-Prices & profits fell for farmers - catastrophe for arable farmers
-One remedy was introducing tariffs on imported foodstuffs- Disraeli as PM changed his mind and now supported free trade, didn’t protect GB agriculture
