economy 1873-1914

Question 1

decline of the staple ind/2nd industrial rev

Answer 1

GB was slow to innovate/invest in new prod methods/machinery to increase efficiency
-GB -steel 7M tons - USA -27M G -15M tonnes where the gilchrist thomas process was used much more effectively.
-produced 80% of world steam ships -declined to 60%
-coal seams increasingly exhausted & only 8% of coal was mechanically cut
-slow to invest in electricity supply unlike G who used it in electrical engineering.
-GB -50% of cotton X were to 1 market -india this single market inhibited the use of newer automatic looms

BUT growth of new domestic inds eg raighleigh bikes, lever bros, liptons groceries, vickers armstrong.
-coal X doubled
-GB electrical, chemical & car ind -growth
-still over half of the worlds steam ships
-still top 3 econs in the world

Question 2

agriculture

Answer 2

canning -meant meat could be transported more easily -from cattle ranches in argentina.
refrigeration -food transported over long distances =fresh e.g from australia.
-suffered from cheap M esp. of wheat -only 25% of that consumed was produced in GB 1900-14.
-50% -fruit, bread, butter, cheese, 40%-meat, 30% eggs -M
-many farmers experienced bankruptcy -average farm profits could only cover 25% of their rent -period.
-farming share of NI decreased from 20-10% in the period.
BUT forced farmers to diversify -expanded into dairy & livestock (40%) which were more resistant to cheap M. -railways connected these expanding sectors to increasing consumer demand.
-poultry farming pop
-warwick, lancastershire & south of scot -not badly effected as they already did mixed farming.
-market gardening -thames valley -fruit, veggies & flowers grew well.

Question 3

X and free trade

Answer 3

GBs commitment to free trade wasn’t always mirrored by competitiors - G & USA had imposed tariffs to protect their emerging industries
-royal inquiry into free trade by sailsbury 1865-6 suggested the lack of tariffs like other countries was harmful to the econ & suggested retaliatory tariffs of 10-15%
-manufactured gds declined from 75-50% of global X
-only 30% of global manufactured goods produced in GB decreased from 40% from 1851-73

Question 5

free trades impact on cons

Answer 5

-cheap M food & stagnant wages =rising real wages -more money could be spent on other things in the domestic econ e.g service sector -growth
-failure of the tariff reform league to gain traction in the 1880s & libs 1906 landslide based on committment to free trade suggests contemporaries didnt see free trade as harmful to the domestic econ.

Question 6

invisible X and financial capitalism

Answer 6

B invested only 5-7% of GNP at home compared to G & USA who invested 12%
-investment abroad didnt directly benefit their competitors but encouraged them to X to GB so they could be paid in £ & have money to pay back their debt - more foreign M worsened the trade deficit.

BUT - returns on investments abroad increased to 8.5% of GDP by 1914
-invested in railways in USA & GB
-trade was still conducted in sterling & GB was still the worlds leading trading & lending nation.