The full article from this blog has been published on The Economic History Review on Early View and it is freely accessible until the 7th April 2021, at this link: https://onlinelibrary.wiley.com/doi/10.1111/ehr.13065
By Tetsuji Okazaki (The University of Tokyo)
The factory system was at the core of the Industrial Revolution. According to Max Weber, the key characteristics of this revolution were, ‘labor discipline within the shop … combined with technical specialization and co-ordination and the application of non-human power’ (Weber,1961). Thus, the emergence of the factory system entailed changes in people’s work mode, as well as changes in technology. Studies that have explored the economic implications of the changes in work modes and technologies brought about by the factory system include Marglin,1970, Sokoloff, 1984, and Clark 1994. In this paper, I estimate production functions to measure the individual impact of changes in work mode, and technology, and compare their impact.
During the early twentieth century the Japanese weaving industry experienced significant technological and organizational changes, which involved both the diffusion of the power loom and the the factory system (Figures 1 and 2).
The above figures are based on data from the “Special Survey of the Weaving Industry” and are contained in the Statistical Report of the Ministry of Agriculture and Commerce, which I use to estimate the production functions. It is notable that the changes depicted in Figures 1 and 2 were not completely synchronized: many factories with handlooms, (manufactories), existed alongside factories with power looms, and outworkers organized by weavers in the putting-out system. In other words, a variety of production organizations and technologies coexisted. In addition, a unique panel data of inputs, outputs, and the diffusion of power looms are available by production organization. These data permit the estimation of production functions which capture technological and organizational variables.
Power looms raised production per worker substantially. By estimating production functions, we consistently find that, after controlling for organizational differences, power looms raised production per worker by two to threefold when compared with handlooms. Furthermore, we have detailed plant-level data for habutae (plain silk fabric) factories in Fukui Prefecture, including working days and working hours. After controlling for working days and hours, production per worker was around 2.6 times larger for powered plants compared to nonpowered plants. Because working days and hours are controlled, and all plant workers were supervised by plant managers, this difference in production per worker can be regarded as a difference in labour productivity due to technology differences.
Contemporaneously, the factory system changed work modes. The literature on the history of the Japanese weaving industry and the reports of contemporary observers indicate that the work mode of outworkers was indeed different from that of factory workers. Outworkers, who were members of peasant households, mainly engaged in farming during the peasants’ busy season, especially the rice planting season in May, which reduced the time available for weaving (Tanimoto 2006). Furthermore, even when they were working on looms, outworkers were often disturbed by other family activities. However, factory workers in this period consistently worked very long hours: approximately 12 hours per day for 300 days per year, under supervision. Thus, the factory system entailed a huge change in people’s work mode. Before the factory system most manufacturing work was conducted on a part time basis. Subsequently, manufacturing employees worked full-time, undisturbed by household chores and the need to produce food.
Long working days, complemented by high work intensity, were reflected in high output per worker. The production function estimation results indicate that production per worker was around twice as great for a factory worker than for an outworker under the putting-out system, after controlling for technological differences. These findings indicate that the magnitude of the organizational effect of the factory system was almost comparable to the technological effect of power looms.
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Clark, G., “Factory discipline”, Journal of Economic History 54 (1994), pp.128–63.
Marglin, S., “What do bosses do? The origins and functions of hierarchy in capitalist production”, Review of Radical Political Economy 6 (1974), pp.60−112.
Sokoloff, K. L., “Was the transition from the artisan shop to the nonmechanized factory associated with gains in efficiency?: Evidence from the U.S. manufacturing censuses of 1820 and 1850”, Explorations in Economic History 21, (1984), pp.351−82.
Tanimoto, M., “The role of tradition in Japan’s industrialization: Another path to industrialization” in M. Tanimoto ed., The Role of Tradition in Japan’s Industrialization (Oxford, 2006), pp.3-44.
Weber, M., General Economic History, Translated by F. H. Night (New York,  1961).