Spain’s Industrial Development in the 19th and 20th Centuries
Agricultural Development
Spain’s industrialization lagged behind the rest of Europe in the 19th century. Its economy remained largely agrarian, with a small and uncompetitive industrial sector. This was due in part to the poor development of the agricultural sector, caused by factors such as:
- Poor land quality
- Adverse weather conditions
- Ineffective agrarian reforms
Liberal land reforms abolished feudal estates and redistributed land, but this often led to short-term profit-seeking rather than long-term improvements. The unbalanced land ownership structure, with large estates in some regions and small farms in others, resulted in income disparities and social unrest.
Despite these challenges, agricultural production did increase, particularly in cereals, vines, olives, and oranges. However, limited processing and productivity hindered the transfer of labor from agriculture to industry and the growth of urban centers.
Demographic Growth
Increased agricultural production supported population growth, which rose from 11.5 million in 1797 to 18.6 million in 1900. However, this was slower than in other European countries due to Spain’s incomplete economic modernization.
Other demographic trends included:
- Population growth in the interior regions
- Increased urbanization, though the majority of the population remained rural
- Emigration to Latin America in the early 20th century
The Rise of Modern Industry
Modern industry in Spain began in the Catalan textile sector, characterized by market-oriented production, protectionism, and mechanization. However, this did not lead to broader industrialization in other sectors or regions due to several factors:
- Low purchasing power and demand
- Scarcity of energy resources
- High transportation costs
- Significant government resource absorption
The Railroad and the Market
The first railway line in Spain opened in 1848, but a large-scale network was not developed until the Railways Act of 1855. The construction process had some drawbacks:
- Overreliance on state protection and foreign investment
- Radial network structure
- Wider rail gauge than in Europe
- Free import of construction materials
Despite these issues, the railway had a positive impact on the Spanish economy:
- Facilitated the movement of people and goods
- Streamlined foreign trade
- Integrated the market, particularly for cereals and textiles
Mineral Resources
Between 1874 and 1914, Spain experienced a boom in mineral exploitation, mainly for export. This was driven by:
- Increased international demand
- Advances in mining techniques
- Mining legislation that allowed foreign companies to exploit resources
However, this did not significantly transform the Spanish economy due to weak domestic demand and lack of capital. The most important mining activities were coal (Asturias) and iron (Basque Country).
Steel Industry
The steel industry replaced textiles as a driver of the Spanish economy. The Basque Country became a major center for steel production, benefiting from high-quality iron ore and imported coke. The industry diversified into capital goods, machinery, shipbuilding, and banking.
The Dissemination of Industry (1874-1930)
Despite these developments, industrial activity in Spain remained limited, concentrated in Catalonia and the Basque Country, and focused on textiles and steel. Traditional industries (food and clothing) dominated elsewhere.
New industries emerged, including metallurgy and chemicals, aided by changes in energy sources (electricity and petroleum). Industrial activity also spread to Madrid and Valencia, but regional disparities increased.
Foreign Trade and State Intervention
Spain’s foreign trade increased during the 19th century, with exports dominated by agricultural products and minerals and imports by raw cotton and coal. The country’s trade policy debated between protectionism and free trade, with the former eventually prevailing. This is often cited as a factor hindering industrial development.
State intervention took the form of tariff protection and increased involvement in the economy. This had some positive effects, such as the emergence of technologically advanced sectors and improved infrastructure.