In Eric Hobsbawm's book, "The Age of Empire", chapter 1 describes the changes taking place in 'developed' areas of the world between the late 19th and early 20th centuries. These changes include a large increase in urban population, decrease in agriculture. Advancements in both economy and technology brought improvements to transportation and production. Mass education seriously cut down on illiteracy in these nations and their new outlook on society was confirmed by the sweeping changes in politics toward liberty and democracy. The second chapter detailed specific transformations through the economies of the developed world. Worldwide deflation brought about reforms to capitalism, ushering in attempts to widen profit margins through protectionism, trusts, and scientific management. Protectionism in turn encouraged a new age of state rivalry with the increase of government role in trade and the enforcement of tariffs. A technological revolution occurred at the end of the 19th century, allowing increased quality and quantities of consumer goods to be created through mass production. Next, Hobsbawm covers empire building and imperialism by the developed countries through conquest and colonization in the third chapter. The division of the globe and colonization of third world countries by the advanced nations was rooted in economic s and was viewed as a status symbol. These global powers then become dependent on their territories for raw materials. Chapter 4 shifts its attention do democracy and politics. Many barriers were put up to slow process of democratization by rulers, but they eventually proved futile one way or another. The turn toward democracy gave birth to mass movements, working class political parties, and unions.
It is interesting that production continued to rise throughout the end of the 19th century, while prices continued to fall. Production capacity at the time vastly outgrew consumer demand. This great increase in supply and relatively miniscule increase in demand was one primary cause for the deflation. But what do you think motivated industry at the time to keep increasing production when there were not enough consumers for their products?
-Derek Leidemann
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Before this time in history production of agrarian goods was very rarely in surplus. In fact, the main fear was famine and the lack of food. I think people in this time period were so used to high demand for food that they just couldn't foresee ever overshooting the demand for it. Technology kicked in quickly with farming equipment and government subsidies kept farms on their feet as they produced way more than what was necessary. Before the farmers even knew it, they had shot themselves in the foot by growing too much too fast. It's really weird to think of something like this today when the world is in need of more food.
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