British Economy during the 19th and 20th centuries - Book Report/Review Example

One f the key historians to condemn the actions f entrepreneurs was Derrick Aldcroft, whose 1969 thesis on the implications f industrialist's actions on the British economy caused controversy. Aldcroft analysed four aspects f entrepreneurial actions; technological progress, methods f production, scientific research and technological education, and commercial methods. Aldcroft argued that investment in technological progress was more beneficial to the British economy than the accumulation f capital (Aldcroft, 1981).

British entrepreneurs were behind their German and American counterparts in this field, as both countries invested more f their profits in newer and more efficient machinery, which could ultimately improve productivity and thus profits. Weiner, who agrees with this opinion stated that, 'insufficient long-term investment hobbled productivity growth, which in turn made such investment ever less attractive, and so on in a downward spiral.' (Weiner, 1981: 129). There are many examples to illustrate this point, but the example to be used here is that f the steel and iron industry.

In contrast to Germany, Britain was slow to adopt new processes for coking and steelmaking, and also to modernize her plants. By adopting the German method f 'direct' steelmaking, Britain could have utilised the by-products and waste gases, which would have resulted in more efficient use f resources and thus less money wasted. However, in 1913, less than 28% f the iron to be used in steelmaking utilised the direct process, compared to 75% f German steel as early as 1900 (Aldcroft, 1981). This lack f technological investment had, according to Aldcroft and other accusers f entrepreneurs, an effect on Britain's role as a world competitor, as it caused the prices f our exports to be higher than American and European prices, which in turn made buyers reluctant to buy British.

This leads to the argument that British entrepreneurs were slow to adopt new methods f production in industries, particularly in tool making and engineering, which resulted in Britain losing key markets to her international competitors (Aldcroft, 1981). Britain had traditionally been the key producer f machine tool, but was replaced by America in the 1880's, after which German tool manufacturers became prominent toolmakers. Germany and America succeeded where Britain failed, due to their effective and resourceful methods f production.

As opposed to producing a large variety f tools in small and inefficient firms, the German and American toolmakers concentrated on mass-producing only one or two types f tool (Aldcroft, 1981). By adopting the resourceful German and American styles f tool production, British toolmakers could have considerably reduced the costs f production and widened their potential markets.The third accusation placed upon the industrial businessmen by Aldcroft is that they failed to recognise the importance f a scientific or technological education, and thus prevented enough research in forwarding methods and products (Aldcroft, 1981).

This was particularly true f scientific industries such as