Is there anyone other than me who suspects that this whole Gleneagles/Live8/Make Poverty History fuss will fizzle out and turn out to have been nothing but an occasion for politicians and rockstars to make some noise?
I think successful economic growth depends on these factors:[...]
Don't forget raw materials - England would never have started the industrial revolution without her coal reserves. It worries me that politicians seem to think economic growth can come from pure trade measures, even when there is little to trade with.
No. England would never have started the industrial revolution without cotton - which it had to import. Coal only served to power the machines that wove the cotton.
I was thinking of the industries that grew up around Coalbrookdale, and wasn't intending my comment as a comprehensive analysis of all the factors contributing to the start of the industrial revolution (particularly the various social/religious factors of which I am sure you are more knowledgeable than I).
I'm curious that you say coal 'only' served to power the machines - isn't that massive increase in energy intensity precisely what separates industrial production from cottage industry?
But power as such does diddly. Otherwise Saudi Arabia would be the leading industrial power in the world today, with Russia and Lybia following. I repeat: look at countries like Italy and Japan, that have to import everything, and still are top industrial economies.
You might as well say that cotton as such does diddly. A manufacturing process requires the raw material to work on, energy required to do the work (food-for-people or fuel-for-machines), a means of converting that energy into useful work (tools or machines), and a working method that enables this to be accomplished efficiently. Take away any one of these factors and the process becomes either impossible or pointless.
While energy and raw materials do not necessarily have to be indigenous (or under colonial control), I find it difficult to envisage the early experiments with very inefficient foundries taking place in an area without sufficient local fuel sources - otherwise the speculative investment in buying and transporting the raw materials would be too risky. Once the basic technology has been proven, it becomes more commercially viable for others to invest in improving the technology or management systems, and to build an economy on adding value to traded commodities.
I suppose I'm wary of this strategy because it depends so much on external factors - the continuing availability of imported materials at a viable price; the continuing low cost of transport relative the the value added; the continuous improvement of skills so industry does not relocate abroad. (This last is possibly slightly less likely with a locally-based company serving an internal market, but in that case there needs to be something exported.)
And I'm not sure how feasible it would be to develop an internal market based on adding value to imports in a country where management and professional skills are inadequate to the task - I'd have thought it safer to build up those skills in a largely-internal market based on largely-indigenous resources.
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Date: 2005-07-01 04:06 pm (UTC)Don't forget raw materials - England would never have started the industrial revolution without her coal reserves. It worries me that politicians seem to think economic growth can come from pure trade measures, even when there is little to trade with.
no subject
Date: 2005-07-01 04:10 pm (UTC)no subject
Date: 2005-07-01 04:29 pm (UTC)no subject
Date: 2005-07-01 04:42 pm (UTC)no subject
Date: 2005-07-01 11:34 pm (UTC)I'm curious that you say coal 'only' served to power the machines - isn't that massive increase in energy intensity precisely what separates industrial production from cottage industry?
no subject
Date: 2005-07-02 04:07 am (UTC)no subject
Date: 2005-07-02 11:34 pm (UTC)While energy and raw materials do not necessarily have to be indigenous (or under colonial control), I find it difficult to envisage the early experiments with very inefficient foundries taking place in an area without sufficient local fuel sources - otherwise the speculative investment in buying and transporting the raw materials would be too risky. Once the basic technology has been proven, it becomes more commercially viable for others to invest in improving the technology or management systems, and to build an economy on adding value to traded commodities.
I suppose I'm wary of this strategy because it depends so much on external factors - the continuing availability of imported materials at a viable price; the continuing low cost of transport relative the the value added; the continuous improvement of skills so industry does not relocate abroad. (This last is possibly slightly less likely with a locally-based company serving an internal market, but in that case there needs to be something exported.)
And I'm not sure how feasible it would be to develop an internal market based on adding value to imports in a country where management and professional skills are inadequate to the task - I'd have thought it safer to build up those skills in a largely-internal market based on largely-indigenous resources.