How did Germany and the U.S. become economically more powerful than Britain around the beginning of the 20th century? It seems like the odds should've beeen in Britain's favor.
>birthplace of the industrial revolution
>control over 1/4 of world's land
>over a century of peace and global dominance allowing it to develop its economy
>half a century of laissez-faire free trade policy
Because it turns out basing your economy on colonial exploitation of primary resources from shitholes half the world away with enormous administration costs is not tremendously efficient.
Plus, Germany wasn't really more powerful economically than Britain, although it did outpace them in a couple of strategic indicators, most especially steel production.
Imperialism was a net drain on the British economy. They invested more into those countries than they took out.
much larger population, technologically advanced, heavily industrialized, enough (and for the US massive) resources.
>with enormous administration costs is not tremendously efficient.
Britain got much more than what they put in tho.
Look at a map. The US is basically in the best possible place for a country to be. Tons of land, tons of mineral resources, huge population, climate excellent for growing food, no neighbors strong enough to threaten you, vast coastline ideal for global trade.
And navigable rivers to make transportation costs around the country cheaper. Dont forget that the rest of the americas is ineviably under the influence of the US aswell.
>half a century of laissez-faire free trade policy
Their economic policy is a major part of what ultimately did them in. Their main rivals like Germany and the United States had much more to gain from free trade than Britain themselves.
In 1907, Germany's population was almost 30,000,000 more than Great Britain, including Ireland. The only larger European country in population was Russia.
Yes, Britain was huge if you count India, but Indians did not pay taxes to London, were not as well educated or as industrialized as domestic Britons and generally were not comparable to an extra 30 million local population.
There's a reason German unification demolished the balance of power. Germany was fucking huge. No other state outside of Russia could match German military-economic potential.
WW1 bankrupted Europe.
Didn't Britain turn to protectionism towards the end though?
Population
this >protectionism
Accomplishes nothing overall, the country has to pay more for the protected product and its limited capital is used inefficiently. Instead of investing in producing auto parts that can compete with imports thereby gaining returns on their investment and setting the stage for auto manufacturing, they invest in auto manufacturing prematurely.
Yes, then the invisible hand of the free market withdrew its favor.
I don't see how population has that much of a drastic effect in the strength of an economy. European countries are sparsely populated in comparison to China and India, yet they were many times richer and more technologically advanced. Also a lower population leads to a smaller workforce, which leads to higher overall wages for everyone. Higher wages lead to more industrialization to avoid worker costs.
Britain was highly protectionist throughout the 19th century, but rather lowered tariffs as time went on.
Population absolutely matters when the people are roughly as educated, trained, and capable. Twice the workers can staff twice the factories and make twice the stuff. The British advantage in manufacturing had evaporated once other countries industrialized, because the thing about early industrialization is that it's more capital intensive than skill intensive.
Higher wages leads to your products not being competitive against a country with lower wages who has the same technology available. When most of the country is still agrarian, it's easier to build more factories to increase production rather than improve technology.
Britain's protectionist policies were also hurting itself, because retaliatory tariffs made British goods even less competitive. The Americans got away with protectionism because they had a massive internal market and relatively wealthy citizens, as well as being the only major industrial power in the Americas.
Better workers
Germany had a much larger population and by the 20th century their industrialization had far outstripped Britain's. The US didn't actually pull that far ahead until after WW1, since Europeans laid waste to one another's countries the US didn't really have any competition after 1917.
The US was ahead by 1880. However, the size of its military and international prestige would not catch up for a couple more decades. By the eve of WW1, the US would have an economy twice that of Metropolitan UK and Germany.
>I don't see how population has that much of a drastic effect in the strength of an economy
It is a massive advantage provided they are educated. Uneducated populations are just dead weight. If you want a reason why Germany's large population was a huge asset and India and China's were not, it's because Germany was one of the first nations in the world to adopt a modern compulsory public schooling system in the 19th century, which they continued into the 20th century. The Germany Federation and later Empire valued having an educated populace due to the increasing complexity of the modern industrialized world. It was an idea the rest of Europe and indeed the United States as well was soon to adopt. And in time the US's own explosively growing population combined with extensive public education programs led to them overtaking the rest of Europe.
Also Europe being set back by two world wars annihilating their infrastructure probably helped America get a leg up.
Germany's university was far superior to that in the UK, especially with respect to scientific research
German mixed economy was superior to British laissez-faire.
Same reason Chinas doing the same thing with America. Industrialization increases the profitability each person produces. The more people a country has, the more value a country can potentially have if it industrialized and developed completely. It's just the brits industrialized first
So to counter China does the U.S need to open the floodgates for immigration?
No companies just need to stop moving their shit to China.
Why is American unskilled/semi skilled labour special enough that I should pay more for them?
>enormous administration costs is not tremendously efficient.
What? The British ruled on the cheap to extremely Jewish lengths. They'd do anything to not put any money into the colony.
They are not, which us why companies are not willing to pay them extra.
The budget for the entirety of colonial Malawi in the 1920's is the street sweeping budget for Glasgow.
They were the Budget MacGuyver's in a continent where colony rule was MacGuyvering as the norm