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By
the end of the nineteenth century the system of Russian capitalism
was in place and displayed certain distinctive as well as common
features as compared with the leading capitalist nations of the
West. What were its more salient characteristics?
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High Degree of Concentration of Production and Labour
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Because Russia
industrialized late and rapidly, advanced
Western technology was borrowed wholesale, with the result that
Russian factories were often more modern than their Western
counterparts. Almost overnight Russia acquired huge plants and
large-scale industries in few industrialized regions. The result was
high concentration of workers in very large-scale industrial
enterprises. In 1900 almost half the industrial labor force was
located in factories which employed more than 1,000 workers - very
high by contemporary European standards. |
Not impressive in quantity
in proportion to total population (about three million out of a
population of about 170 million in 1914), the Russian proletariat
was therefore more densely massed than in other countries, forming
large and closely knit groups in industrial centers, which included
St Petersburg and Moscow. This heavy concentration of labor in the
few nerve centers of the empire would pose great danger to the
imperial government after the workers had discovered, in 1905, the
powerful weapon of a general strike to pressurize employers and the
authorities.
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The high concentration of production inevitably led to the formation
of monopolies. The owners of large-scale enterprises belonging to
the same branch of industry began to co-operate with one another in
regulating output and setting prices for their goods. This allowed
the monopolists to establish control over the market, dictate their
terms to the consumer and thus extract maximum profits. |
The
monopolies first appeared in the form of syndicates in which
individual companies maintained their autonomy in matters of
production while co-operating in setting prices for their products.
By the early twentieth century syndicates began to turn into trusts
in which enterprises were incorporated into a single production
system managed from one centre of command. Monopolies existed in all
major branches of industry, such as oil extraction,
sugar-production, railway rolling-stock production, coal-mining,
metallurgic industry.
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High Concentration of Financial Capital
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The process of the formation of trusts led to radical
changes in the organization of production and required huge
financial resources. Industry was beginning more and
more to depend financially on banks. The concentration of
industrial production went hand in hand with the
concentration of financial capital. In the early twentieth
century the five biggest banks controlled most of the
finances. They eagerly invested in industry and to a
considerable degree subordinated it to their control. |
As a result, the confluence of
financial with industrial capital took place. Major financial
tycoons sat on governing boards of industrial enterprises; while
leading industrialists and entrepreneurs became closely linked with
banking. The financial oligarchy emerged which had concentrated in
its hands huge financial and industrial resources. In the early
twentieth century this new force would begin to vie with the
government for the right to direct the country’s economic
development.
