Patterns of European Industrialization: The Nineteenth Century

Patterns of European Industrialization: The Nineteenth Century. Edited by Richard Sylla and Gianni Toniolo London: Routledge, 1991. xii + 276 pp. Figures, tables, contributors, and index. $22.50. ISBN 0-415-08156-4.

Richard Sylla and Gianni Toniolo have collected twelve insightful essays on Alexander Gerschenkron's contributions to our understanding of European economic development. Gerschenkron's research interests covered several aspects of European industrialization, synthesizing many interpretations of industrialization into a `relative backwardness' concept in contrast with the prevailing 'stage' theories of industrialization of the 1960s. In their introduction the editors state that "[a]ccording to Gerschenkron, relative backwardness-however measured-is a powerful explanatory variable of such characteristics of industrial development as timing, growth rates and structural change.... The variables to be considered, however, should be those most relevant for the emergence of preconditions for subsequent economic development. Among such variables he therefore included savings ratios, literacy, some technology-related indicators (e.g. patents), per capita social overhead capital, and even less measurable ones such as ideology" (p. 6). The essays in this volume use these variables, and others, to test some of Gerschenkron's hypotheses.

In their introduction, Sylla and Toniolo couch their interest in European industrialization within the context of trying to understand the rapid economic, social and political changes currently taking place in Eastern Europe. In some former Soviet countries economic growth has been impressive; in others, disappointing. Given uncertainty about the future paths of development in Eastern Europe, can historical analysis, through the lens of Gerschenkron's hypotheses, give us any focal ideas on which to concentrate? As the editors note, nineteenth-century industrialization may provide some general insights into the transition to a market economy, but we should proceed with caution in applying historical lessons, because the current initial conditions for this transition differ so greatly from those a century or more ago.

The eleven remaining essays divide into two sections: institutions, ideologies and interpretations, as well as country studies. Knick Harley's essay on institutional endogeneity starts the first section forcefully. Harley examines Gerschenkron's ideas on substitutions for lacking prerequisites, citing such modern work as Oliver Williamson's (1975, 1984) research on the substitution of hierarchies for markets, particularly in less developed economies. Richard Sylla analyzes the role of banks in European industrialization, discussing Gerschenkron's fascination with banking along the way. Paul Gregory uses Russia as a case study of the role of the state in promoting economic development, arguing that one of the important missing preconditions in Russia in the nineteenth century was a strong middle class. William Parker examines the connection between industrialization and political ideology with a comparative study of American and European patterns of growth. Donald McCloskey contributes an analysis of Gerschenkron's industrialization rhetoric, focusing on his use of words and metaphors.

N. F. R. Crafts, S. J. Leybourne and T. C. Mills open the country studies section of the volume by looking at British industrialization. This essay summarizes many of Crafts' earlier contributions and uses sophisticated time-series analysis to conclude that Britain's industrialization was indeed unique relative to the nations of continental Europe, with a longer, slower growth-rate trend, leading into the mid-nineteenth century. Maurice LevyLeboyer and Michel Lescure discuss French growth, although they seem to skirt an issue essential to Gerschenkron's contribution. They argue that France was more advanced in the nineteenth century than previously thought, based on evidence such as railroad investment; however, France's available capital for railroad construction came predominantly from the government. Gerschenkron argued that the government substituted for imperfect capital markets in backward countries, implying that France was relatively backward. Richard's Tilly's analysis of German industrialization suggests some difficulties with Gerschenkron's model, particularly the absence of "an explanation of state behavior and changes in it.... Explaining the role of the state means developing an appropriate model of political change" (p. 192). Giovanni Frederico and Gianni Toniolo apply Gerschenkron's model to Italy; they find that German banks may not have played much of a role in Italian industrialization, and that "around 1900, the Italian economy was probably richer and more diversified than Gerschenkron supposed, so that several causes were at work in producing the 'spurt' " (p. 213). David Good's essay on Austria-Hungary echoes some of Tilly's observations on Germany, indicating that while Austria-Hungary did not "confirm" (p. 218) Gerschenkron's relative backwardness thesis, the economics of Austro-Hungarian history is intertwined with the interplay of society and state prevalent throughout Habsburg history (p. 239). In the final essay, Olga Crisp analyzes Russian industrialization. Crisp argues that more recent historical work has brought to light information highly inconsistent with Gerschenkron's hypotheses about Russian industrialization; she emphasizes particularly the role of railroads and the persistence of stable agricultural growth rates. As with the Levy-Leboyer/Lescure chapter on France, though, Crisp fails to address the question of how advanced Russia really was if the government was providing the capital for railroad investment.

One mark of Gerschenkron's influence on economic history is the flurry of research activity over the past three decades stemming from trying to explore his relative backwardness concept even further, and to test its resultant hypotheses. This collection of interesting essays is a testament to the continued importance of Gerschenkron's work.

[Author Affiliation]

Lynne Kiesling is assistant professor of economics at the College of William and Mary.