Structural Changes in the First Industrial Revolution

Structural Changes and Social Consequences

The structural change during the first technological revolution consisted of a transfer of assets from the primary sector to the secondary sector. This resulted in a major contribution from the secondary sector to the GDP (PIB).

The Transition from Rural to Urban Models

In social terms, this meant relocating the transit of a rural model that dominated the Old Regime to a more urban one. Society shifted from being dependent on the primary sector, living in scattered and small-scale communities, to a society more oriented toward the secondary and tertiary sectors, living in urban centers where productive population changes operate.

Shifts in Demand and Consumption Patterns

This change is important from the point of view of demand because consumption patterns in rural society differ from those in urban society:

• Rural society is characterized by backward agriculture, where the purchasing power of farmers was very small and landowners continued to adhere to a traditional model of consumption.
• Urban society is characterized by the existence of a larger population organized into social groups dependent on unpaid activities, which could exercise a power of "drag" on the population employed in the primary sector.

The Rise of the Urban Middle Class

The emerging urban middle class with the Industrial Revolution became major consumers of manufactured goods, which accounted for further dense market consolidation. This was due to structural change: the emergence of a productive agriculture with a clear market orientation, supported by the liberalization of land from landowners to peasants and the establishment of property rights.

Impact of Labor Liberalization and Technology

• This increase in output represents a liberalization of labor toward higher productivity sectors.
• Labor liberalization promotes the need to adopt new technologies.
• The growing integration of domestic markets, thanks to innovations in transport (railways), allowed for agricultural specializations that were previously impossible, rising living standards, and the development of urbanization.

The Evolution of Capitalistic Agriculture

The introduction of new crops and the expansion of livestock (ganadería) increased production. Improved productivity and market orientation set the pace for the transition from traditional agriculture into capitalistic agriculture. This generates surplus production that causes the movement of the population from agriculture into industrial cities and the resulting coverage of labor demand that the industry generates.