Industrialization

Industrialization is the procedure through which an economy is converted from a predominantly agricultural to a manufacturing economy. The hallmarks of industrialization are the growth of the economy, the efficient labor division, the application of new technologies in solving problems, and reducing human involvement in the process. As a rule, industrialization leads to an increase in total income and standards of living in a society.

Industrialization explained

Industrialization is a process characterized by the transition from an economy based on agriculture and resources to an economy driven by mass production. In place of individual manual labor comes mechanized production, in place of craftsmen - assembly lines.

Most often, the term "industrialization" is linked with the European Industrial Revolution that occurred in the late 18th and early 19th centuries, however, industrialization also took place during the Great Depression in the US.

The Second World War also contributed to significant industrialization, which caused the growth and development of large cities.

The full impact of industrialization on society is not fully understood, however, it can be said with full confidence that it led to a decrease in the birth rate and an increase in the average income of the population.

History of Industrialization 

As mentioned above, the beginning of industrialization was the Industrial Revolution, rooted in the late 18th century. Before industrial manufacturing plants became widespread, processes such as making and further processing were carried out manually in people's homes.

The crucial invention of that period was the steam engine, which made it possible to use many types of machines in production. In parallel, the growth of the metallurgical and textile industries began, which became a kind of impetus for the start of goods’ mass production. In order to maintain production capacity, there was a gradual development of other sectors of the economy, such as transportation, finance and communications.

The Industrial Revolution contributed to an extraordinary increase in the wealth and financial well-being of certain segments of society. In addition, the specialization of labor was strengthened, which helped cities to support a larger population and caused a rapid jump in demographics.

Further development of Industrialization

During the Second World War, atypical demand for specific groups of goods appeared, which also increased production capacity. The post-war reconstruction of Europe was carried out at the same time as the massive population growth in North America. This made it possible to maintain high capacity utilization and stimulate subsequent growth in industrial activity.

Fast industrialization in other parts of the world, such as East Asia, was noted at the end of the 20th century. Meteoric economic growth was recorded in Hong Kong and Singapore, South Korea and Taiwan, and afterwards these territories have changed significantly. The rejection of rigid central planning and the transition to a mixed economy was felt in China as its own industrial revolution.

Industrialization methods

Multiple industrialization strategies have been applied around the world, with varying degrees of success.

The Industrial Revolution initially took place in Europe and the United States under the mercantilist and protectionist policies of governments, which contributed to early industrial growth. However, later it came to refer to more liberal or free market approaches that open markets to foreign trade.

Originally, the Industrial Revolution took place in Europe and the United States against the backdrop of mercantilist and protectionist government policies, which had an impact on early accelerated industrial growth. However, a little later, it began to refer to a more laissez-faire and free-market approach, opening up new markets for foreign trade.

The strategy of import-substituting industrialization was widespread among the countries of Latin America and Africa in the post-war space. This strategy combined protectionist limitations to trade with direct subsidies or nationalization of domestic industries.

Concurrently, some parts of Europe and East Asia were pursuing an alternative export-led growth strategy. The strategy’s preference was given to the intentional striving for foreign trade in order to create export industries. But to some extent, it depended on maintenance of a weak currency in order to increase the attractiveness of exports for overseas buyers. As a result, export-led growth strategy has outpaced import-substituting industrialization.

In the 20th century, socialist countries repeatedly reverted to deliberate planned industrialization programs that were independent of domestic and foreign trade markets. The first and second 5-year plans in the USSR and the Great Leap Forward in China are good examples of it. Along with the growth in the production of industrial goods against the backdrop of a general economic recovery, repression and pressure from the government spread in society, which significantly affected the living and working conditions of workers.