Global Economy 10: The Industrious Revolution Flashcards
• We will define the “industrious revolution” • Was the industrial revolution demand driven? • We will look at a number of demand driven theories • The theories will be considered against the empirical evidence - perhaps it was not so industrious after all
Cite De Vries’ remark when he answered ‘was the Industrial Revolution a demand-side phenomenon?’
Economists are always ready to acknowledge supply and
demand - production and consumption - as paired forces in the
shaping market economics but they do not commonly accord
to demand a causative role in the process of economic growth.
Studies of modern economic growth are inevitably
founded on a decisive “supply-side” advance, which
economic historians have variously located in technological
change, enlarged supplies of capital, energy and raw materials,
and new institutions that allowed these factors of production
to be deployed more effectively… Yet the accumulating
evidence for an earlier increase of per capita income in
northwestern Europe paired with a major refinement of
material life casts serious doubt on the orthodoxy that
the Industrial Revolution was the actual starting point
for long-term economic growth. (De Vries 2008)
Briefly state what the Industrious Revolution is
The Industrious Revolution was a period in early modern Europe lasting from approximately 1600 to 1800 in which household productivity and consumer demand increased despite the absence of major technological innovations that would mark the later Industrial Revolution. Proponents of the Industrious Revolution theory argue that the increase in working hours and individual consumption traditionally associated with the Industrial Revolution actually began several centuries earlier, and were largely a result of choice rather than coercion
State McKendrick’s quote on the “Consumer Revolution”
The family household generated demand for manufactured
goods, as well as generating the income to pay for them.
Working mothers could no longer make their own clothes and
the clothes of their children, they could make less of their own
food… as one contemporary commented, everything a
working woman wore was manufactured except her face:
instead of being taught to mend, they were taught to
spend. (McKendrick, 1982)
What was the “Consumer Revolution”?
- Focused on 19C consumption of manufactured goods
- Households demanded goods both to indicate status and to
defend against the purchases of others - Import bills for luxury products led domestic firms to import
substitute - Different technical and raw materials required innovation not
just imitation - Marketing and commercial skills also developed
- Income earning opportunities increased for women and
children - Women used their increased household power as consumers
What is De Vries’ description on the Industrious Revolution?
- The industrious revolution was a process of
household-based resource reallocation that increased both
the supply of marketed commodities and labor and the
demand for market-supplied goods. (De Vries, 1994) - Draws on McKendrick’s “Consumer Revolution” in 18C
Europe and Hayami’s “Industrious Revolution” in
industrialising Japan - Argues that the Industrious Revolution began before the 18C
Industrial Revolution (1760-1840) → demand side
phenomenon that preceded the IR - Change in household-level consumption patterns → based on
expanding trade empire and consumption choices - Required a change in employment pattens to match (hours
worked) - Places the IR in a broader historical setting
Describe the narrative behind a demand-side revolution (drivers)
- After the “Great Discoveries” there were many new products
that became available for consumption - America bought potatoes, maize, sweet and hot peppers,
turkey and chocolate - Increased trade made tea, silk, china and sugar readily
available - The rise of manufacturing replaced home with market
production - These extra choices led households to want to consume goods
beyond their existing budget constraints - Demand for new types and combinations of goods then drove
the supply side - Women and children became fully employed in the market
economy in response to demand
What are the ‘Great Discoveries’?
Christopher Columbus arrived in America in 1492 and Vasco da Gama opened up the route to India in 1498. Under the impetus of Portugal and Spain, new trade routes were opened to reach the « Indies » without having to pass through the intermediaries what were then the Arab countries and Venice. The Portuguese chose to go round Africa via the Cape of Good Hope to reach India; this was done by Vasco da Gama in 1498. The Kingdom of Spain supported the project of Genoese Christopher Columbus to open a western route to India, which would eventually link Europe up to the Americas in 1492. These « Great Discoveries » mark the start of a globalization process by contributing to the strong growth of trade between continents: the « triangular trade » between Europe, Africa and the Americas, the trade between Europe and Asia thanks to the precious metals mined in the « new world » colonies
What does a ‘demand-side revolution’ imply?
- Consumer demand grew regardless of wages → Households
increased demand for goods in the marketplace - Households also (simultaneously) increased both the supply of
commodities and labour → Households increased the supply
of money earning activities - This was based on a complex decision on how to allocate
time inside and outside of the household
Driven partially by commercial incentives (relative prices,
reduced transaction costs) - Driven by changes in tastes (consumption vrs leisure)
- Impacted family considerations regarding quality and
quantity of children, women’s labour, and home production
How is the current UK government clamping down on ‘side hustles’?
They have recently began taxing the selling of second-hand items on sites like Etsy or Ebay
How does the Industrious Revolution cause IR?
Include De Vries’ quote
- Men are forced to labour now because they are slaves to their
own wants. (De Vries, 1994) - De Vries (1994) argued that family or household labour per
year increased in response to market changes
=⇒ New consumption possibilities led to increased market
labour
=⇒ Households chose to put extra hours into the market and specialise - Essentially the result was:
↑ Demand for Industrial Goods <=> [↑( L/N )][( Y/L ] = [↑( Y/N )]
where N = population, L = Employment, Y = Total Output
The IR was therefore a result of increasing labour force
participation due to a change in tastes and consumption
technologies (demand driven)
But what drives this change?
Is there a theory behind De Vries claims?
State De Vries’ quote on Theories of Households
As demand led me to the consumer, the consumer led me to
the family and its household economy. (De Vries, 2008)
State the 2 views on the nature of the household in the economy
- Reactive View (The Sociologists) - Exogenous Households
- Interactive View (De Vires) - Endogenous Households
Describe the reactive view on the nature of the household in economy
- Reactive View (The Sociologists) - Exogenous Households
- “Structural-Functionalism”
- “Family Decomposition”
- “Marxist/Feminist” “Marxist perspective on the family” and
“Feminist perspective on the family”…
Describe & explain Structural-Functionalism
Include key believers
Structural functionalism, or simply functionalism, is “a framework for building theory that sees society as a complex system whose parts work together to promote solidarity and stability”
This approach looks at society through a macro-level orientation, which is a broad focus on the social structures that shape society as a whole,[1] and believes that society has evolved like organisms.[2] This approach looks at both social structure and social functions. Functionalism addresses society as a whole in terms of the function of its constituent elements; namely norms, customs, traditions, and institutions.
Functionalist thought, from Comte onwards, has looked particularly towards biology as the science providing the closest and most compatible model for social science. Biology has been taken to provide a guide to conceptualizing the structure and function of social systems and analyzing evolution processes via mechanisms of adaptation … functionalism strongly emphasises the pre-eminence of the social world over its individual parts (i.e. its constituent actors, human subjects).
— Anthony Giddens, The Constitution of Society: Outline of the Theory of Structuration
Auguste Comte believed that society constitutes a separate “level” of reality, distinct from both biological and inorganic matter. Explanations of social phenomena had therefore to be constructed within this level, individuals being merely transient occupants of comparatively stable social roles. In this view, Comte was followed by Émile Durkheim. A central concern for Durkheim was the question of how certain societies maintain internal stability and survive over time. He proposed that such societies tend to be segmented, with equivalent parts held together by shared values, common symbols or (as his nephew Marcel Mauss held), systems of exchanges. Durkheim used the term “mechanical solidarity” to refer to these types of “social bonds, based on common sentiments and shared moral values, that are strong among members of pre-industrial societies”.[1] In modern, complex societies, members perform very different tasks, resulting in a strong interdependence. Based on the metaphor above of an organism in which many parts function together to sustain the whole, Durkheim argued that complex societies are held together by “solidarity”, i.e. “social bonds, based on specialization and interdependence, that are strong among members of industrial societies”
Describe the interactive view on the nature of the household in economy
- Interactive View (De Vires) - Endogenous Households
- Family is the site of alliances between husband and wife
- Family creates implicit contracts between parents and
children - Alliances and implicit contracts are sufficient to develop
adaptive strategies for common consumption objectives