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Industrialization is a complex phenomenon which defies simple definition, but most basically refers to a particular structural change in an economy:
- a relative expansion of manufacturing
Once thought to be a "sudden" occurrence, hence, the widespread use of the term "industrial revolution".
Now believed to have been a more gradual process involving much more than the growth of factories and the redeployment of the labour force:
- typically associated with important social and cultural changes, the nature of which may vary from one country's experience to another.
(Be sure to read the review of British and US industrialization in the Guide as background for our treatment here of the "Canadian case". In addition to the print references given there, you might like to look at a new basic reference on American industrialization on this topic, W. Licht, Industrializing America: The Nineteenth Century, (Johns Hopkins Press, 1995). For more on the role of technology in American industrialization a handsomely illustrated reference is B. Hindle and S. Lubar, Engines of Change: the American Industrial Revolution 1790-1860 (Smithsonian Institution Press, 1986).
In the Canadian case:
- industrial development began well before
- markets for industrial output
- suitable supplies of labour
- food to feed an expanding the industrial work force
- appropriate skills and knowledge
- organizational abilities
- effective financial institutions
- stable government
Meeting even these requirements (and there
may be more) has been possible in only some countries...which may help
explain why there are not more "industrialized" countries in the world
- by the late in the 19th century these local markets were becoming larger due to population increase and rising incomes
- but these growing markets could be supplied by imports
- unless tariffs were imposed to make imports more expensive
- but imposing tariffs raised the likelihood of retaliation by trading partners and might also provoke political oppositon from domestic consumers.
The rapid growth of the prairie wheat economy helped attract a large inflow of foreign capital which supported large-scale infrastructure investment, especially in railways.
Railway construction contributed to the development of new resources in the Canadian Shield
- new discoveries of metallic
mineral deposits such as those at Sudbury
New technology made possible the development of hydro-electric power resources which in turn permitted development of
- electro-chemical manufacturing
In addition to all this, the terms of trade
(the ratio of Canadian export prices to import prices) shifted in favour
of food and other commodity exports.
This failed when the Liberals lost the 1911 election to the Conservatives -- who remained committed to the old protective regime introduced by Macdonald in the 1870s.
But some US companies were anxious to obtain access to cheap Canadian raw materials
Example: big American newspaper companies
succeeded in getting Congressional approval to reduce duties on imports
of pulp and newsprint from Canada...and invested heavily to develop the
Canadian pulp and paper industry.
Rapid growth of the non-agricultural labour
force at the turn of the century.
As the industrial labour force increased
so did union activity, creating new "industrial relations" issues.
The census decade 1901 to 1911
Despite official policy, many immigrants in this period found their way into non-farm employment.
Even on the prairies, urban population
grew twice as fast as rural population.
Provincial governments were responsible for education under the BNA Act.
But the federal supported technical and some specialized educational programs for farmers ("agricultural extension" work, in which provincial governments also participated).
Higher forms of professional education
were well established prior to 1900
- self-help "fraternal organizations" organized on a local basis.
In the mid 1800s a new form of labour organization
appeared, the Railway Brotherhoods
Another influence from the US, an idealistic labour movement known as the Knights of Labor
Formation of the Trades and Labour Congress
of Canada in 1886
Outside the TLC, several splinter movements
Fuel supplies were limited in central Canada
(wood and coal were the main fuels used in 19th Century industrial production)
Water power was widely available, but required plants ("mills") to be located on waterways.
Late in the 19th century electrical energy
created new opportunities for industrial development in central Canada
where excellent hydro-power sites were plentiful (especially in Quebec).
First in the Cordillera
Later in the Canadian Shield region of
Base metals became of interest toward the
turn of the century
By the 1920s Ontario and Quebec were becoming major sources of metallic mineral production and Toronto was emerging as a financial centre where capital was raised for mining and other resource-frontier ventures.
We know that technologies have traditionally been "embodied" in capital, so that there is a link between the discovery of new techniques and the process of real capital formation.
In Canadian history we find examples of technologies being imported through the processes of investment and immigration
There are also examples of technologies produced locally.
Both imported and locally developed technical change in industry appear to have been prevalent in the first decades of the 20th Century in Canada ... but the specific causes of this remain obscure.
- mining and metallurgical processes (example: nickel)
- transportation equipment (example: diesel powered track-type heavy vehicles)
- chemicals (example: explosives)
- pulp-and-paper (example: mass communication)
- aviation (example: reliable light aircraft)
(But also note the negative impact of the
war on the Canadian economy...loss of manpower, social unrest, waste of
This issue remains controversial, but the evidence seems to suggest that the record of Canadian "enterprise" has not been as bad as suggested.
Like business everywhere, Canadian firms have had to be profitable in order to survive and this has meant:
- exploiting the country's initial
comparative advantage in producing raw material exports for more development
Perhaps, as Easterbrook suggested, because of the high level of "uncertainty" (as distinguished from measurable "risk" ) in the Canadian business environment which public policy tried to offset by:
- tolerating monopolistic forms of
And was business in Canada expected, in return, to accept certain constraints on its operations to help promote economic and political sovereignty and national unity?
(We will return to this topic in a later
lecture in the second term. See if you can accumulate some evidence to
support or refute these possibilities as we move through the rest of the
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