Why an Industrial Revolution Did Not Occur in China

Abstract

This paper is to investigate the reasons why industrial revolution did not occur, or didn't occur in China by using a traditional factor analysis and a cause-and-effect logic. The basic conclusion of this paper is that the technology, labor and capital are three main preconditions and components of the industrial revolution and among them, the weak in technology is the fatal factor for the absence of modern industry in China, while labor and capital did not conduce to severe obstacle against China's possible industrialization.

The ideology of this paper is not Euro-centric for its consent on China's parallel socio-economic condition with Europe before 1800. Nor I am convinced of the necessity of a wide comparison of every aspect of economic and political changes between two civilization systems.

As the logic behind "differences alone cannot create comparability"[1], not every piece of history over a thousand years can be responsible for the generation of industrial revolution.

Because of the lack of an accurate social model for quantitative simulation, comparisons may only have reference value but not decisive significance

For example, even it is proved that China was weaker in every aspect than Europe, we still cannot rule out the possibility that industrial revolution may take place in China. But when analyzing China, comparisons with Europe may help provide us valuable references for a better understanding of the preconditions of industrial revolution.

Thus the purpose of comparison should not be win-or-lose judgment, but should be the establishment of axis for reference and a better plot of the situation.

Industrial revolution: what makes it?

The industrial revolution was symbolized by wide use of big machinery and factories. Only this new-born input factor could magnify the existing productivity, assemble the dispersive (free) labor and capital.

Without big machinery, the excess labor would increase the unemployment and create environmental and social pressure; the flourish of silver exploited from colonials could not change into capital needed for the economic development but flow to luxurious upper class life.

An example of a waste of gold was Spain, or more exactly, the Europe before seventeenth century. Between 1500 and 1650 there were estimated 181 tons of gold and 16,000 tons of silver reached Europe from America officially, which means further very large quantities must have arrived by contraband.

The King of Spain needed this silver to meet his expenses in war, and Europe's mercantile community needed it to lubricate its transactions and to provide a means of paying for luxuries from India and the East.[2] But neither of these activities could give us a perspective of an improvement in economic productivity because apparently those large abundant of capital was consumed instead of being put into reproduction area. However, in contradiction the flourishing factories and machineries pointed out explicitly where the capital was spent on in England. Thus it can be expected that a surplus of capital needs investment-friendly environment and institutional support to contribute to an economic flourish. Otherwise the community "may have been an empty shell by economic criteria".[3]

It is worthwhile to notice that the renovation of technology must have to function in the way of incorporating large scale capital and labor to help give birth to the industrial revolution, but not in a normal progressive way to promote the productivity similar as usually happened in the past. The path-breaking contribution of Watt steam engine was the introduction of physical/chemical natural power taking place of the domination of human/animal power over the past several millenniums. And this newly controlled power was proved to be, theoretically and practically, enormous. Without a revolutionary change in how the production process can be re-organized and essentially improved, there would not be a sudden call for large new source of capital to work, nor any remarkable improvement in productivity and social environment would take place.

How about labor? Evidences can be found to support that there was sufficient movable surplus labor in England due to several social mechanisms. Even we take Pomeranz's view that Europe had disadvantage compared with China in areas of agriculture, land management, and the inefficient use of certain land-intensive products (especially fuel wood)[4] as true, all these negative factors actually did not stop the giant population growth in large cities, due to an absolute total growth as well as huge number of immigration. "In the eighty years or so after 1780 the population of Britain nearly tripled, the towns of Liverpool and Manchester became gigantic cities, the average income of the population more than doubled".[5] Besides the absolute number change, the population structure also changed. In 1700 four-fifths of the population was rural and two-thirds agricultural. By 1821, however, 46 per cent of Britain's three million families depended on "trade, manufacture and handicraft" as against 33 per cent in agriculture. This trend continued over decades and by 1841 only 28 per cent of Britain's population was supported mainly by agriculture.[6] And this labor increase did not trigger any social crisis in forms of famine or unemployment because of two social security factors. One was the sufficient food supply. The other was the industrial demand for labor driven from new technology and sufficient raw materials from the new world.

The food security was granted by agricultural revolution. There were lots of research emphasized on England's improved agriculture productivity that can support the centralized workers in big cities and the booming population in England. Statistical research indicates that England (not Britain as a whole) agriculture output growth was 0.9 per cent per annum between 1700 and 1750.[7] That was a 56.5 per cent rise over the 50 years. The same trend applied to Britain, and indicated a strengthening over time. Britain's agricultural output grew at 0.6 per cent per annum in the early eighteenth century, 0.8 per cent in the late eighteenth century and 1.2 per cent during 1801-31.[8]