Late Feudalism and Overseas Expansion: Finance and Development
ITEM 2. Late Feudalism. Overseas Expansion. FINANCE AND DEVELOPMENT OF THE ARTICLES
Next to the agricultural economy in the AR
Developed an urban dimension also existed mainly based on secondary and tertiary activities, which were implemented mainly in the existence of a particular urban system played by trade and particularly the colonial trade, and industrial typology in some cases at the origin of the subsequent industrial revolution technology.
A) The Functionality of European Cities in the Old Regime
In a largely agrarian economy, cities and urbanization played a very limited role, which does not mean they were not affected by changes. These modifications were:
- A transfer of urban Europe from south to north
- A slight increase in urban population [in 1500 there were four cities with more than 100,000 inhabitants. And in 1800 there were only 25 cities exceeding 100,000 inhabitants]
Moreover, what concerns us is that the city had two major developments with regard to the rural world:
- It had different demographic models: smaller vital rates, the mortality crisis affected differently (+ epidemic – hunger), the family model was different, families were less extensive and the life cycle had no such effect.
- The mechanisms by which birth control were different from those of urban areas, mainly because the city used to attract migratory movements or expel people based on their level of economic activity.
What generally happens is that the cities of this period were enough for them to their natural growth to meet the demand for labor in abundance, first to recover lost strength after an epidemic and secondly due to a change of functionality.
The change in functionality of the activities at this time was very difficult, only produced in specific circumstances such as:
- The city received some type of administrative role
- The particular city should become head of traffic
- Change of functionality related to the modification of transport systems
- The city becoming a natural focal point of activities
- Change that occurs as a consequence of early industrial activity (second half XVIII century)
B) Industrial
European industry before industrialization had features quite different from those to be from the Industrial Revolution.
B.1) General Characteristics of Industrial Activity at the Time
Industrial activity is linked to the development of urban and city growth, which means it must be understood primarily as an activity whose demand comes from the city.
It was an activity intended primarily for the manufacture of consumer goods and specifically to meet the most basic demand (food, clothes, etc.). And in the case of intermediate goods, it focused mainly on the metal industry (farming utensils or military weapons).
It was an industrial activity with low technology and energy use, but with a high level of labor.
In many cases it was a subordinate activity to the agriculture sector, a part-time job that allowed farmers to get additional income.
The industry at that time attended mostly local and regional markets and only in cases of highly specialized activities did it reach further markets.
As for the location, it could be both urban and rural. In the first case, it was typically focused on large cities or cities with good connections (large ports). And in rural areas, industries were located in poor agricultural areas.
B.2) Models of Industrialization of the Old Regime
Craft Workshops:
These are small production units located in urban areas and subject to union control. These guilds controlled the production process and prices. In these workshops the number of workers could range between 5 and 10 people.
Industry Dispersed:
This model involves the entry of commercial capital into industrial activities, an entry that could occur for two reasons:
- For the needs of capital from these craft workshops
- At the possibility to serve foreign markets
As the review by the commercial capital was intensified, there was a growing process of ruralization of many industrial activities. These merchants who already controlled craft production began to shift toward the countryside a high percentage of the production process, because the peasant labor was cheaper and because it raised the possibility of eluding the control of the guilds.
Manufacturing Concentrated:
Large production units similar to the factory of the nineteenth century, but which differed in the two cases:
- They used very little technology and energy and relied on hard work
- It was only public initiatives in which the state became the industrialist.
The state becomes the industrialist because of three reasons:
- It intended to curb demands of the monopolized unions
- It becomes an entrepreneur in those strategic sectors (the military)
- The income sectors that provide very high profits for the Public Treasury (production of snuff)