Industrialisation, Politics, and Banking Instability in Late Imperial Russia
This thesis examines industrialisation, politics, banking and social instability in late Imperial Russia. The early-to-mid-1890s were characterised by rapid industrial growth, which was driven by protectionist policies and the state procurement of industrial products. The period 1899-1902 saw a severe financial and industrial crisis. The subsequent period 1903-1905 was marked by widespread labour strikes at industrial enterprises, a war with Japan, and a nation-wide revolution in 1905. My main findings are as follows. First, the national development policies of the 1890s incentivised, although did not compel, commercial banks to finance industrialisation. When industry experienced a slowdown during the financial crisis of 1899-1902, banks sustained devastating losses. This evidence suggests that national development policies had a destabilizing impact on bank performance. Second, in response to the financial crisis, the State Bank, a quasi-central bank of Russia, implemented a multifaceted approach to crisis containment. I find that this multifaceted approach was successful in maintaining price, employment, and financial stability. The evidence also suggests that the State Bank’s crisis response was identical to the types of policies employed over a century later by the Federal Reserve during the 2007-09 financial crisis. Third, in response to the financial crisis, the Russian government, along-side privately-owned industry, transferred income and wealth from ordinary workers to industrialists and investors. The evidence also suggests that industry forced the labour force to either work longer hours or more intensively. The distributional effect appears to have contributed to the occurrence of labour strikes, and ultimately to the 1905 revolution.
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