To What Extent Did the Russian Economy Improve in the Period 1894 to 1914?

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The Russian economy is universally declared to have been a thoroughly backward prior to 1890s therefore it is highly likely that there was economic improvement in the given period; however the extent of this is difficult to define due to the varying manifestations of economic improvement and the independence with which they may occur. The finance minister during this period was Sergei Witte, and to him the majority of the improvements are credited, yet the improvement was not universal. Whether this was him personally or simply a product the awful conditions which the Russian economy rose from is to be decided.

In 1897, 82% of the Russian population were peasants, leading one to the believe that any economic improvement must be both partially caused by and result in improvements in this area. This is because generally the greater the economic improvement the greater the amount of people are involved in bringing it about and the greater the number of people it affects for the better. The situation in 1894 was a mass of peasants that owned small and mainly subsistence farms. This meant that they sold very little of their produce and therefore had very little money. This was bad for two reasons. Firstly if they sold little then the state would have very little to sell to other countries, meaning that no extra wealth was coming in to Russia. Secondly, if the peasants had little money than they would not be able to buy much. If we acknowledge John Keynes’ theory of demand as true, this lack of it can only be seen as a severe impediment to the Russian economy. To answer the question, one must therefore decide if either the peasants started producing enough to sell or if less people were peasants. There is evidence to suggest that between 1890 and 1910 there was an increase of 38 million tonnes of cereals produced. One could argue that this shows economic improvement because they were working the land more efficiently, and therefore selling more so getting richer, the extra wealth generated would be pumped into other areas such as manufacturing due to the rise in demand. In addition the extra grain acquired by the government could be sold to other countries, and this money could then be spent on industry, improving the economy. This theory is complemented by the fact that between 1897 and 1914 Odessa, the major gain exporting port, saw a rise in population from 403 thousand to 499 thousand, which would lead one to believe that more people lived there because there was more work to be done because there was more grain to export. On the other hand it could be believed that this does not show an improving economy firstly because it 74 million tonnes in 1910 is actually a lot less per hector then more developed countries were able to produce. They were still poor in comparison with other countries such as England which had experienced the industrial revolution and therefore had more efficient farming. In addition it must be taken into account that the population of Russia was rapidly increasing at this time, it doubled between 1861 and 1914 to 130 million people, therefore this increase in food production would not have lead to a vast amount of either overseas income or surplus money because they needed to eat most of it. This argument would lead one to the belief that on both an international and internal scale the agriculture of Russia shows very little economic improvement. It is, however commonly acknowledged that a failing of Witte’s was his lack of action in the agricultural department. The fact that in 1914 four-fifths of the population were still peasants that we have already asserted helped very little towards an economic improvement puts into great doubt the scale of such an improvement. Nevertheless it is possible for large change to be implemented by few people therefore instead of passing judgement based only on Witte’s weakest area of economic reform the others must be examined.

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