British Industrial Capitalism since the Industrial Revolution

Citation

Jones, E. (1999), "British Industrial Capitalism since the Industrial Revolution", International Journal of Social Economics, Vol. 26 No. 4, pp. 578-581. https://doi.org/10.1108/ijse.1999.26.4.578.4

The desire for certainty and simplicity appears to be deeply etched in the human psyche. It is rampant in academic economics, but has had predictable difficulty establishing a strong foothold in the writing of history. The concept of “long waves” in economic activity has provided a solution to this conundrum. History can now be made to proceed in a reliable manner. This is an attractive proposition, and it is difficult to escape from its clutches once having been exposed to its seductive appeal.

Lloyd‐Jones and Lewis display a curious ambivalence towards “long waves”. They have taken a Schumpeterian “soft” line in emphasising the historical‐ and nation‐specificity of detail. They have criticised the conventional emphasis on aggregates, claiming that the aggregates hide substantial structural differences ‐ “the long wave is embodied at the level of the microeconomy” (p. 135). They have struggled to put the best interpretation on troublesome statistics that do not tell a clear story. They do everything possible to find truth in long waves. Ultimately, they plump for their plausibility only in the nineteenth century; they deny that the twentieth century experience in Britain can be bent to a “long waves” setting.

The authors complement a long wave structuring with the “neo‐Schumpeterian” approach of Carlota Perez who emphasises not merely the major technological changes but also the institutional changes through which technique is diffused. Thus there is a dialectic between the “technological style” of the age and the “mode of development” (or socio‐institutional structure) appropriate to that style ‐ the dialectic exists because technique and social fabric do not develop synchronously. In the case of Britain’s “Industrial Revolution”, the escalating productivity of mechanised production does not reach its zenith until an appropriate institutional framework is set in place by the 1850s (free trade imperialism). In the meantime, sectoral crises occur (the 1830s and 1840s) which impel a resolution; and so on. There is talk of a “key factor” within the technological style, and coal is given the honours in the “Industrial Revolution Kondratieff”.

The duality of technological style and institutional fabric has a long history, not least in the Marxian base and superstructure and, more recently, within copious literature on the “social fabric of the market”. We can be thankful for a critical mass of opinion on the importance of the social fabric, not least because the opinionated and influential economics profession continues to theorise “the market” as a stand‐alone edifice. Yet it is unwise to hope for too much regularity and clarity of line. There has never been a common language in how the duality will be constructed ‐ what goes on either side of the divide. In this work, the authors are including (by the turn of the twentieth century) managerial organisation into the “technological style” box (p. 88), highlighting the ambiguity of the conceptual divide.

The authors attempt to fit the evolution of British capitalism into the proposed dialectic of technological style and institutional fabric, but from the late nineteenth century the plot unravels. The elucidation of the conceptual apparatus becomes progressively more vague ‐ the reader is left searching for clear expositions of what goes into the two boxes (and what is the associated “key factor”) at each stage. The authors conclude that Britain fails to confirm to the proposed pattern after the (so‐called) take‐off into the third long wave in the 1890s, but persist with an organisation of the book along the lines of the pattern that cannot be found.

The authors are more at ease with the fine detail than with the big picture. Their characterisation of the socio‐institutional structure of the “second Kondratieff” (mid‐nineteenth century) as variously “free trade imperialism” and “free market economy” (pp. 35, 49, 96) displays an imperfect understanding of the contemporary British political economy. The structure might have been one of (almost) free trade, but the integral imperial dimension was hardly happenstance or hands‐off. Domestically, the evolving legislative and regulatory agenda was a complex mixture of “Smithian” liberalism (Poor Law reform, free trade; Civil Service reform, etc.) and Tory/Conservative attacks on that agenda (Factory/Mine/Hours Acts; public health acts; trade union recognition; etc). Rather than a “free market economy” providing the structure functional to the full flowering of the potential of the machine age, it is arguable that the contribution of the Tory “wets” (with the seventh Earl of Shaftesbury as exemplar) was a crucial element in inhibiting the new “technological style” from imploding from its manifest social contradictions. Moreover, the unpredictable character of this political mix highlights that there is nothing mechanistic about the evolving socio‐institutional structure.

As another example, the authors’ discussion of the presumed failure of the development of an appropriate structure for Britain to capture an 1890s long upswing is hampered by an inadequate appreciation that the appropriate structure for national accumulation is of global, not merely national, proportions. Britain might stay on free trade, but the significance of that edifice changes dramatically after the 1870s when the rest of the world plays by different rules.

The major lesson of this book is the danger of strong belief in long waves. If the authors had followed the logic of their own argument, they might have come to the same conclusion. Frank Wilkinson, in a 1983 review of Gordon, Edwards and Reich’s 1982 book, Segmented Work, Divided Workers (surprisingly neglected in this volume), highlights how susceptible are estimates of aggregate data for long wave “periods” to the choice of beginning and end dates[1]. The data provided by the present authors confirm that doubt is well‐founded. The “long wave” literature has perennially uncritically reproduced (and extended) Kondratieff’s periodisation, while simultaneously moving from a price‐based to an output‐based conceptualisation.

Moreover, the long wave literature obscures the fact that we are dealing with a beast called capitalism. We do not have to blame the economic crisis in Britain in the 1830s or the 1870s on a disjuncture between technique and social fabric; we need look no further than the phenomenon of overproduction, an integral product of the competitive process. The so‐called “troughs” continue to be analysed inadequately, with a neglect of the quantitatively dramatic (if cathartic) spurts in accumulation. And so on.

This book is an unhappy marriage between a‐priorism and empiricism. It delivers a radical uncertainty (unacknowledged) rather than the desired explanatory order. A jettisoning of the long waves baggage might have allowed closer attention to building a “plausible story” for the nation‐specifics of the evolution of British capitalism.

The authors’ “comparative advantage” in fine detail, however, is reflected in the treatment of the turn of the twentieth century ‐ was Britain’s failure to follow the American model of corporate form and labour process a major step in the long decline? Their intimate knowledge of the Sheffield region highlights that Sheffield steel producers were well informed of overseas developments, yet conscientiously pursued a reproduction of organisational forms as a basis for niche markets in speciality steels (p. 118). Given the current attraction to non‐Fordist regimes, the now respectable game of heaping opprobrium on British practices might proceed with more caution.

In general, the authors do a good job in elucidating the various debates regarding British “performance” at key moments during the twentieth century, and one must reluctantly conclude that the jury is still out on the key questions ‐ is “decline” a meaningful label; if so, when and how did it occur and recur? This book demonstrates (indirectly) that the pursuit of historical truths is not for the simple‐minded or the faint‐hearted.