Global Spread of Industrialization: Economic Integration and Factor Mobility
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International Diffusion of the Industrial Revolution (1815-1914)
Stages of Industrial Revolution Diffusion
First Stage: Integration and Cooperation (1815-1870)
This period saw the diffusion of the Industrial Revolution within a framework of integration and international economic cooperation. Europe moved along the path of free trade, facilitating capital transferability and technological diffusion. Foreign investment and British technology served as key drivers for the spread of railways across the continent. This, combined with the integration of markets and its impact on international economic growth, generated a virtuous circle of growth that fostered complementarity and convergence between leading and first-comer nations in a process of positive feedback.
Second Stage: Protectionism and Nationalism (1850/1870-1914)
This stage was characterized by a less favorable context. In addition to the inherent difficulties of late industrialization (such as increased entry barriers and heightened competition), new obstacles related to the international economic environment emerged. The Long Depression (1873-1896) and the fin-de-siècle agrarian crisis led to a return to protectionism, with subsequent restrictions on the international mobility of factors. Some countries adopted industrialization strategies with shades of economic nationalism, including protective tariffs and state intervention.
European Expansion of Free Trade
Zollverein (1833)
A customs union among the 39 states of the German Confederation, which had driving effects on internal growth by canceling internal tariffs.
Bilateral Treaties: Cobden-Chevalier (1860)
The treaty between France and Great Britain had multiplying effects on third countries by including the extension of the “most-favored-nation” clause to agreements signed by either party with third states. Given the hegemonic role of both nations in international trade, this led to a generalization of bilateral or multilateral agreements in which tariff duties were relaxed. Consequently, the value of international trade doubled between 1830-1850 and quadrupled between 1850-1880.
International Mobility of Factors
International Capital Flows (Foreign Investment)
International Labor Flows (Migrations)
Explanatory Factors for Migration (Pull & Push)
Three primary types of factors influenced international migration:
Labor Supply and Demand: Related to the economic cycles of issuing and receiving countries, which determined employment opportunities.
Strictly Demographic Factors: Such as excess or lack of labor.
Availability and Cost of Transport: Advances in transoceanic navigation significantly reduced barriers to movement.
This can be understood through an “attraction-repulsion” model, driven by:
- Employment opportunities and good salaries in America.
- Population growth due to the “demographic transition” (decreased mortality), coupled with eviction from factories and trades due to the irruption of mechanization.
- Advances in transoceanic navigation.