The Second Industrial Revolution: Origins and Economic Impact

The Factory System

The factory system marked a transition from artisanal tools to machine-based production. This shift created a significant infrastructure gap between large-scale factories and traditional small workshops.

The factory owner provides the machinery, raw materials, and energy sources, while paying wages to workers for repetitive, monotonous, and mechanical labor. This concentrated production model generates a large volume of goods.

This system represents a new application of liberal capitalism.

Characteristics of Liberal Capitalism

• Private Ownership: The means of production are owned by the bourgeoisie.
• Capital Accumulation: The bourgeoisie seeks to maximize profits through the accumulation of capital.
• Free Market: Production is directed toward a free market, governed strictly by the law of supply and demand.

The Second Industrial Revolution (1850–1914)

This era was defined by extraordinary scientific progress and the proliferation of machinery. Key developments included:

• New energy sources and raw materials.
• Diversification of industries, transport systems, and communication.
• The emergence of the automobile and assembly line production (Taylorism).
• Growing business concentration.
• New industrial powers competing with Britain, such as the USA and Japan.

Energy Sources

Oil: First exploited in 1859, oil offered superior power and strength. It allowed for a variety of products, fueling transport and machinery, and led to the rise of the first petroleum companies.

Electricity: While its existence was known, new methods for transmission and application emerged, revolutionizing street lighting and industrial power.

Metals and Materials

While iron remains a primary metal, the era introduced significant advancements:

• Steel: Replaced iron for many applications due to its durability and versatility.
• Alloys: Aluminum became prominent for being lighter and more durable.
• Other Metals: Increased use of copper, lead, zinc, and tin.

New Industrial Sectors

The steel industry surpassed the textile industry as the primary economic driver. Key new sectors included:

• Chemistry: Essential for producing fertilizers, explosives, dyes, and cleaning products.
• Electrical Industries: Provided the energy necessary to power new machinery and early automotive developments.
• Automotive Industry: The emergence of mass-produced vehicles.