Modern Times

European Capitalism in the Second Industrial Revolution 1900-1950

During the first half of the twentieth century Europe lost its position of economic leadership to the United States. This development is probably the most significant economic development of this era, aside from the Great Depression. But it has never been quite understood how and why it happened. This project embarks on a new direction in the study of comparative economic history by making detailed quantitative analyses of technological competence and economic performance in European countries for three benchmark years (1910, 1935 and 1950) on the level of industrial branches.

What were the reasons why Europe lost track, can we identify in what technologies or industries this became visible, and how can we account for the effects of the world wars and the Great Depression? How can we analyse the interactions between these shocks and the long run forces of welfare growth? This project analyses the sectoral composition and sectoral growth patterns in the European economies. It includes a systematic analysis of levels of economic welfare and productivity in manufacturing branches and industry-related services.

Combining the benchmarks with existing national data on long term development of industrial branches (see e.g. the GGDC Historical National Accounts Database) provides a dynamic view of convergence and divergence on the level of sectors and industries. This will improve our understanding of the relation between technology and the European pattern of industrialisation and welfare growth in comparison with the United States.

Three PhD’s and a Postdoc will be involved in the project, which is funded by the Netherlands Organisation for Scientific Research (NWO). The strategic aim of the proposal is to create a transnational research infrastructure for the comparative study of European economies.