Discussion: Comparing British and German industries 1900-1940

Thomas1195

Banned
As previously explained to you (repeatedly), American machine tools were cheap and specialized, ideally suited to the production of munitions, but were generally not used for more complex jobs by the British. Can you please define "automatic" and "semi automatic" and provide a reference for when those were introduced by the American or German industries? Automatic American machine tools would have been truly amazing in 1914, since it appears they only started to be introduced in the 1950s!http://blog.modernmechanix.com/an-automatic-machine-tool/



You are continuing to embarrass yourself. It is clear you do not understand the fundamental principles of either economics or trade. Britain had control of the oceans and therefore unfettered access to global markets. As a proponent of free trade, Britain generally sourced its products from those producers best equipped to supply the required products (i.e. with a competitive advantage). For example, lamb from NZ, wool from Australia, nitrates from Chile or monocles from Germany. The advantage of this approach is the products are cheaper because they produced by suppliers with a competitive advantage. It also means that Britain can focus its resources on production that can maximize its returns.

An obvious contrast is the British and German approach to food supply. The British food production was clearly more efficient than the Germans, but Britain chose to import approximately half its food supply instead of increasing or maintaining domestic food production. Because the colonies can produce food far cheaper than domestic production, price of food is cheaper and the standard of living for the British is higher. Instead of marginal food production (beit more efficient than Germany), the British population can be employed in more productive sectors. In contrast, due to the pressure from the Junkers, German agriculture was heavily protected by tariffs and food exports (specifically sugar) supported by subsidies. This increased the cost of food to Germans and distorted the allocation of resources, which could have been better used in sectors other than German agriculture. Or alternatively, German agriculture could have been forced to be more competitive.


I think you may have confused/conflated threads with the [redundant] Britain not going bankrupt thread...

Well, the economic principle of free trade had strangled British electrical equipment in particular and most new industries in its infancy, and thus it could not grow to a competitive scale. Worse, all of them turned out to be strategic industries in both world wars, such as optical industry providing binoculars, range-finders or scopes to the military; or electrical and electronic industry providing communication equipment like radio, telephone...; or electric motors used to generate electricity, which in turn is used for running munition factories.

This theory do not apply to infant industries (of course the barrier should be lifted when the industries grew to an adequate scale), as well as developing countries (of course the latter case does not apply to Britain). Britain would have established a dominance in synthetic dye without much difficulty if it was protected. For new industries, competitive advantage comes from learning and developing. Next, it is never desirable to specialize in low tech, low value industries and let your competitors produce new, high tech, high value products. Your overall term of trade and competitiveness would eventually deteriorate, leading to large trade deficit. For example, an electric powered machine would generate more revenue than a steam powered one, and worse, technological changes means that steam powered machinery would be phased out. Besides, your specialized industries (for example textile) would also be eventually outcompeted if your competitors begin to use the technology provided by the new industries (like using Northrop looms).

For manufactured products, increasing returns, learning, and technical change are the rule, not the exception; the cost of production falls with experience. With increasing returns, the lowest cost will be incurred by the country that starts earliest and moves fastest on any particular line. Potential competitors have to protect their own industries if they wish them to survive long enough to achieve competitive scale (wiki, criticism of ricardian theory). None of the major industrial nations developed their economy using free trade policy.

Finally, specialization could face risk when wars break out. Like IOTL, supply of many crucial products from Germany to UK was cut off, and vice versa. Germany was not in a position to outsource its food sector. If they did like the UK, they could never hold on to 1918.

The American and German industries only caught up to Britain in value terms around 1900. It would seem wasteful for the British to by shiny new machinery, if the existing kit is doing the job. An engineering colleague refers to this as 'sweating the assets' - extracting the maximum possible use out of an asset before replacing it. It obviously becomes a balancing act, as newer tech becomes more efficient and older kit breaks down more.

It is a testament to the resilience of the British industry that it continued to compete effectively for so long using old kit and without resorting to trade barriers.

Finally you basically say it is good for a country to not modernize its factories and industrial base to improve productivity and competitiveness until it's too late. Imagine that Britain could fight WW2 without lend-lease.
American firms were willing to scrap old machines even before their useful life ends and retool with better ones.
 
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In regards to the attempts to discount the weaknesses of the German economy revealed in wartime, or the inefficiencies resultant of either the imperial junkers or the Nazi Party...

Confucius Say "Don't start nothing, won't be nothing."
 

Thomas1195

Banned
In terms of steel manufacturing techniques we can look at the WW1 army helmets: The British Brodie Helmet was flatter while the German Stahlhelm was dome or bowl-shaped. Forming steel into a curve or dome is difficult, and the German helmet shows their superior steel manufacturing techniques.
 

BooNZ

Banned
Well, the economic principle of free trade had strangled British electrical equipment in particular and most new industries in its infancy, and thus it could not grow to a competitive scale. Worse, all of them turned out to be strategic industries in both world wars, such as optical industry providing binoculars, range-finders or scopes to the military; or electrical and electronic industry providing communication equipment like radio, telephone...; or electric motors used to generate electricity, which in turn is used for running munition factories.
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Finally, specialization could face risk when wars break out. Like IOTL, supply of many crucial products from Germany to UK was cut off, and vice versa. Germany was not in a position to outsource its food sector. If they did like the UK, they could never hold on to 1918.

In 1914 it would be more accurate to describe optics and electrical equipment as niche industries and potential bottlenecks in times of war - not so much strategic. Despite largely ignoring those fields before the war, the British managed to muddle through without a significant impact on their war effort.

This theory do not apply to infant industries (of course the barrier should be lifted when the industries grew to an adequate scale), as well as developing countries (of course the latter case does not apply to Britain).
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Potential competitors have to protect their own industries if they wish them to survive long enough to achieve competitive scale (wiki, criticism of ricardian theory). None of the major industrial nations developed their economy using free trade policy.

Are you referring to German sugar production which was heavily and protected and subsidized despite German being the largest sugar producer in the world in 1910? Or are you referring to German steel production being subsidized to the extent it was used in British dreadnaught production, despite Germany being the second largest steel producer in the world (after US) at that point. Or are you referring to German textile production, where despite British competitive advantages in supply chain, production and quality, Germans continued to increase market share due to low pricing and subsidies.

Being continually propped up by the German taxpayer is not obvious illustration of German industrial excellence...

Britain would have established a dominance in synthetic dye without much difficulty if it was protected. For new industries, competitive advantage comes from learning and developing.

The larger population bases available to both Germany and the US meant that it was be unrealistic for Britain maintain dominance it had previously enjoyed in almost all markets. Far better to focus on those markets where it was more competitive/ profitable.

Next, it is never desirable to specialize in low tech, low value industries and let your competitors produce new, high tech, high value products. Your overall term of trade and competitiveness would eventually deteriorate, leading to large trade deficit.

The following 1900 GDP per capita data suggests this could not be supported at the time:
$4,320 New Zealand
$4,299 Australia
$4,096 United States
$3,134 Germany
$1,135 Japan

Those economies effective at producing food and with unfettered access to markets continued to do extremely well economically up until the increased protectionism triggered by the Great Depression. Even today 'modern' economies heavily protect their corporate factory farms and inefficient lifestyle blocks at the expense of the wider taxpayer base (both in taxes for subsidies and increased cost of living).

For manufactured products, increasing returns, learning, and technical change are the rule, not the exception; the cost of production falls with experience. With increasing returns, the lowest cost will be incurred by the country that starts earliest and moves fastest on any particular line.

Indeed, in most established industries, Britain had started decades ahead of the competition...

Finally you basically say it is good for a country to not modernize its factories and industrial base to improve productivity and competitiveness until it's too late.

Define "too late". Britain was not protecting or propping up its industries to the same extent as Germany or the US. The profitability of British industry was excellent compared to its competition and its access to markets and financial resources remained unmatched.

American firms were willing to scrap old machines even before their useful life ends and retool with better ones.

Can you provide references providing examples where this was widespread practice in the US?
 

Thomas1195

Banned
...


In 1914 it would be more accurate to describe optics and electrical equipment as niche industries and potential bottlenecks in times of war - not so much strategic. Despite largely ignoring those fields before the war, the British managed to muddle through without a significant impact on their war effort.


...

Or are you referring to German steel production being subsidized to the extent it was used in British dreadnaught production, despite Germany being the second largest steel producer in the world (after US) at that point. Or are you referring to German textile production, where despite British competitive advantages in supply chain, production and quality, Germans continued to increase market share due to low pricing and subsidies.

Being continually propped up by the German taxpayer is not obvious illustration of German industrial excellence...



The larger population bases available to both Germany and the US meant that it was be unrealistic for Britain maintain dominance it had previously enjoyed in almost all markets. Far better to focus on those markets where it was more competitive/ profitable.



The following 1900 GDP per capita data suggests this could not be supported at the time:
$4,320 New Zealand
$4,299 Australia
$4,096 United States
$3,134 Germany
$1,135 Japan

Those economies effective at producing food and with unfettered access to markets continued to do extremely well economically up until the increased protectionism triggered by the Great Depression. Even today 'modern' economies heavily protect their corporate factory farms and inefficient lifestyle blocks at the expense of the wider taxpayer base (both in taxes for subsidies and increased cost of living).



Indeed, in most established industries, Britain had started decades ahead of the competition...



Define "too late". Britain was not protecting or propping up its industries to the same extent as Germany or the US. The profitability of British industry was excellent compared to its competition and its access to markets and financial resources remained unmatched.



Can you provide references providing examples where this was widespread practice in the US?

Too late here means that British technological curve had lagged behind its competitors.

No propping up or protecting new industries means that British electrical or (modern) machinery firms, which were followers not first movers, were strangled by German and American pioneering firms like GE and Siemens. Britain thus could never become a major player in electrical and electronic industries, which was a very highly profitable sector and also provided the basis for the modernization of other industries and the whole economy (electrification).
Being dominated by foreign firms' subsidiaries means that British electrical sector would totally technologically depend on Germany and America. Besides, these subsidiaries might produce the most obsolete electrical products in Britain (this is common in LDCs such as various SE Asian countries) , thus delaying the technological advances in the British electrical industry and the whole economy as well. Electrical and electronic, as well as optical equipment sectors were strategic in modern warfare of the 20th century.

Free trade and no protection means that small newcomers cannot grow into large firms to create competitive advantage, as small firms could not carry out large-scale investments and R&D.

Japan since 1980s had smaller population base than the US but still surpass the US in various high-tech sectors, partly thanks to protectionism.

I never advocate the protection of established sectors, just new sectors. New sectors are always more high-tech and have better potential profitability, and many of them also have big impact on the whole economy like electrical and electronic industry (as well as the computer industry after ww2, which provides the basis for automation and computerisation; British car industry lagged during the 1970s-1980s also because of its lag in computerisation and automation).

FACT: British industries had to retreat to Empire markets because it could not compete in neutral markets.
 
By that logic, Germany was failing. It's goal was to create an economic empire to give it economic territory.
 

Thomas1195

Banned
By that logic, Germany was failing. It's goal was to create an economic empire to give it economic territory.
No, Germany was winning because its products drove British goods out of non-Empire markets, and even invaded Empire markets.
 

Thomas1195

Banned
Winning in European and American markets (industrial markets) proved that your industrial products were superior. British producers had SURRENDERED these markets to superior German firms.
 
Boy howdy we have another Frisian Folly situation here, right down to the multiposts. I'm not the most versed in this, but I'd reckon that if you can compete against the new toys with worse kit and do well enough to win twice that it probably means you're using your industry better, old as it is, and that's what's more important.
 

Thomas1195

Banned
Boy howdy we have another Frisian Folly situation here, right down to the multiposts. I'm not the most versed in this, but I'd reckon that if you can compete against the new toys with worse kit and do well enough to win twice that it probably means you're using your industry better, old as it is, and that's what's more important.
Being heavily indebted after the first and virtually bankrupt after the second despite winning, while having much at least 2 powerful allies in both wars, is far from invicible. Note that in the ww1, the German clearly had a chance to win the war if the US stayed neutral, despite having to shoulder AH and Ottoman.
 
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Could you give any of your view about the comparisom between two countries' industrial sectors.

They were very different because of their different developmental histories and the countries' different relationships with trading partners, resulting in different specialisations, strengths and weaknesses.
Analysing each country's industry in isolation is not particularly useful because each country did not operate in isolation, but was part of a wider network of economic relationships.
The best guide to their industries is probably to examine their large-scale industrial achievements around the time in question.
 
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Thomas1195

Banned
They were very different because of their different developmental histories and the countries' different relationships with trading partners, resulting in different specialisations, strengths and weaknesses.
Analysing each country's industry in isolation is not particularly useful because each country did not operate in isolation, but was part of a wider network of economic relationships.
The best guide to their industries is probably to examine their large-scale industrial achievements around the time in question.
Well, yes, but many studies focus on sectoral comparison for engineering industries, especially the high tech ones as they reflect a country's technological level.
 

BooNZ

Banned
Well, yes, but many studies focus on sectoral comparison for engineering industries, especially the high tech ones as they reflect a country's technological level.

If we were to compare military innovation, the French routinely dominated the backward Heer, as illustrated by the early introduction of smokeless gunpowder Poudre B for use in small arms (in the 1880s), the early introduction of fast firing artillery (in the 1890s), the introduction of pointed bullets (cunningly renamed to Spitzer to sound more German) and early French advances in military aviation. Up until 1912 France routinely dominated the application of military science and yet in most cases those initial innovations were ultimately surpassed by late adopters using more contemporary approaches.
 

Deleted member 1487

If we were to compare military innovation, the French routinely dominated the backward Heer, as illustrated by the early introduction of smokeless gunpowder Poudre B for use in small arms (in the 1880s), the early introduction of fast firing artillery (in the 1890s), the introduction of pointed bullets (cunningly renamed to Spitzer to sound more German) and early French advances in military aviation. Up until 1912 France routinely dominated the application of military science and yet in most cases those initial innovations were ultimately surpassed by late adopters using more contemporary approaches.
It's not quite that simple. Largely the same issue applied to Germany after the Franco-Prussian war that hurt the French after WW1: complacency. They thought what they had was good enough because it won the last war a generation ago, plus had industry and numbers on France. It was only when the international situation turned on them in the 20th century due to bad diplomacy and older generals aged out that the modernizers finally got the funding to play catch up. By WW1 they had corrected their technological deficiencies and were actually leading in most fields, especially artillery. France had been forced to realize they were not the masters of the continent anymore after Prussia+allies whipped them badly and occupied the country. So they put money into modernizing their forces and trying to find a lead in military affairs; their problem was that they had largely stagnated by 1910 and the Germans had surpassed them again, while they thought the Russians were enough of an offset against the Germans. Belatedly they tried to catch up in artillery and training by extending conscription, but they were no where near the forefront of military technologies by 1912 and even really since 1908 they had fallen badly behind, as the Germans finally started spending on their army again to modernize it. Meanwhile the French were caught in the idea of having bright red and blue uniforms and offensive au outrance. Russia if anything was ahead of France because of their experience in the Russo-Japanese war and learned the hard way what was needed to modernize. Ultimately it wasn't an issue of industrial technology that put France ahead, it was the willingness to spend on the army after the Franco-Prussian war, which the Germans were not, as they economically integrated their empire and spent on the navy.
 
Well, yes, but many studies focus on sectoral comparison for engineering industries, especially the high tech ones as they reflect a country's technological level.

Country's don't have 'tech levels' in anything but a very general (1st/2nd/3rd world) each industry or even each firm/factory is different....

And even if they did, then by a country's "tech level" I presume you mean its "access to tech"?
 

BooNZ

Banned
It's not quite that simple. Largely the same issue applied to Germany after the Franco-Prussian war that hurt the French after WW1: complacency. They thought what they had was good enough because it won the last war a generation ago, plus had industry and numbers on France. It was only when the international situation turned on them in the 20th century due to bad diplomacy and older generals aged out that the modernizers finally got the funding to play catch up. By WW1 they had corrected their technological deficiencies and were actually leading in most fields, especially artillery. France had been forced to realize they were not the masters of the continent anymore after Prussia+allies whipped them badly and occupied the country. So they put money into modernizing their forces and trying to find a lead in military affairs; their problem was that they had largely stagnated by 1910 and the Germans had surpassed them again, while they thought the Russians were enough of an offset against the Germans. Belatedly they tried to catch up in artillery and training by extending conscription, but they were no where near the forefront of military technologies by 1912 and even really since 1908 they had fallen badly behind, as the Germans finally started spending on their army again to modernize it. Meanwhile the French were caught in the idea of having bright red and blue uniforms and offensive au outrance. Russia if anything was ahead of France because of their experience in the Russo-Japanese war and learned the hard way what was needed to modernize. Ultimately it wasn't an issue of industrial technology that put France ahead, it was the willingness to spend on the army after the Franco-Prussian war, which the Germans were not, as they economically integrated their empire and spent on the navy.

The bait was meant for the OP, but to paraphrase, Germany was the dominant land power during a period of French military innovation, but any French advantage evaporated after the Germans started to take France seriously as a military threat. The absence of any tariff reform suggests the British were yet to decide if German industrialization represented a threat or opportunity to British interests.

The French enjoyed a very real qualitative superiority over the Heer until Germany started to introduce genuine fast firing artillery in significant numbers (circa 1906). Poudre B and later fast firing artillery were revolutionary breakthroughs, which the Germans struggled to replicate on a timely basis, despite their best efforts. The subsequent German military advantages over the French were largely attributable to organization and doctrine, which were probably pre-existing conditions masked by inferior kit.

As far as German science, the only meaningful German military technology advantage before the war that comes to mind is the design of super-heavy artillery. In 1914 French industry was more than capable of producing functional heavy artillery, drab coloured uniforms and shovels to dig holes. However, from 1912 the French army made consistently bad choices in procurement, doctrine and training.
 
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