HIST363: Global Perspectives on Industrialization

9a. Compare Soviet and Maoist industrialization with each other and with capitalist industrialization

• Define war communism. Why did Lenin replace it with his New Economic Policy, NEP?
• What did Lenin mean by the Commanding Heights of the Soviet economy?
• Why did Stalin end the NEP and what did he replace it with?
• What were the objectives of the Great Leap Forward? Why was it a failure? What were its results?
• How did Soviet and Chinese Communist industrialization differ from industrial development in capitalist countries, such as Britain and the United States?

The Russian Revolution of 1917 and Chinese Revolution offer examples of alternative forms of industrialization. After he had helped create the Soviet state in Russia, Vladimir Lenin (1870–1924) introduced a state-controlled economy that was characterized by the expropriation of private businesses, the nationalization of industry, and the forced state requisition of surplus grain and other food products.

These policies led to food shortages, a decline in agricultural and industrial production, and civil unrest, which convinced Lenin to introduce his New Economic Policy, NEP, in 1921. The NEP meant a temporary retreat from the doctrinaire centralization of the economy and the reintroduction of capitalism to the economy. While the government retained control of the "Commanding Heights" of the economy (banking, foreign trade, and large industries), it fostered a mixed economy that allowed private ownership of small businesses and enterprises. The NEP continued until 1928, following Lenin's death in 1924.

Following his rise to power, Joseph Stalin (1878–1953) abandoned the NEP in 1928 when he introduced his first Five Year Plan to dramatically increase Soviet industrial production and force the collectivization of agriculture. While his industrial goals were unrealistic, Stalin managed to dramatically increase the industrialization in the new Soviet Union. However, when he forced the collectivization of agriculture, millions of farmers and agricultural workers starved to death when they were left with too little of their crop to live. Agricultural collectivization was a failure for the Soviet state.

The Chinese Revolution of 1949 introduced a second alternative form of industrialization and a state-controlled economy. After the Communist takeover, its new leader Mao Zedong nationalized most, but not all, of China's industries. The government embarked on an extensive land reform program which redistributed land from more prosperous farmers and landlords to peasants who had little or no land.

From 1953 to 1957, China embarked upon its own five year plan which was quite successful. However, in 1958 Mao Zedong decided to change course and speed up economic and industrial development through his Second Five Year Plan, the so-called "The Great Leap Forward". Forced collectivization and industrialization, and attempts such as backyard iron furnaces, led to a dramatic agricultural failure and the deaths of an estimated 45 million people.

Review the Soviet Union in Communism in the Heights, 1917: Economic Apparatus, 1921: The New Economic Policy, 1924: Industrialization Debate, 1929: Shock Workers, and 1929: Year of Great Change by Lewis Siegelbaum.

Review China in China in the 20th Century, China: The Great Leap Forward, 1958–60, and Great Leap Forward. 

9b. Assess the effects of British rule on India and identify major economic developments since India gained independence

• What major impact did British colonial rule have on India from a political, economic, and social standpoint? Did life change significantly for the average Indian? What about the elites?
• How did British rule in India help or hinder Indian economic and political development? In what ways might it have provided a foundation for Indian national unity in the Post-Colonial period?
• How did India's mixed economy exemplify positive and negative aspects of central economic planning? Why did central planning ultimately hinder economic development?
• Define import substitution industrialization. How was it applied in Latin America and Africa? What were its successes and failures?

While, post-revolutionary Russia and China fostered economic development and created a state-controlled economy based on central planning and five year plans, India pursued an economic "Third Way" which favored a mixed economy. When it gained political independence from Britain in 1945, the state controlled major industries, but encouraged small businesses and enterprises to operate within a typical capitalist framework. The Indian government also retained the foundation of parliamentary democracy which it had inherited from British colonial rule.

Many developing countries in Africa and around the world copied India's mixed economic model. While some argue that their centralized planning helped develop basic industries and foster economic development, others believe it may have delayed greater growth and the bureaucratization of the economy.

For example, India and Latin America promoted import substitution industrialization to promote domestic production with mixed results. Domestic industries were established, but production levels and product quality suffered due to a lack of foreign competition. Nevertheless, the state-sponsored support system provided an economic foundation that allowed businesses to eventually integrate into the global economy. This support likely helped cultivate the robust economic growth many of these countries are experiencing today.

Review The Economic and Social Impact of Colonial Rule in India, India's Way and India's Permit Raj, and Import Substitution Industrialization.

Unit 9 Vocabulary

• Commanding heights
• Five year plan
• Great Leap Forward
• Import substitution industrialization
• Joseph Stalin
• Kulaks
• Mao Zedong
• Mixed economy 
• New Economic Policy, NEP
• Vladimir Lenin
• War communism