Government and Business Case Study

UK’s Manufacturing Competitiveness (A): Who Said ‘The Sun Never Sets On the British Empire’?

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Abstract:
This case study is the first of the three-part series, which deals with the rise and fall of Britain’s manufacturing leadership since 17th century. It primarily illustrates how Britain rose as the global power and took the advantage of its Empire to flourish its economy and industry. Called as the ‘Land of Industrial Revolution’ Britain although majorly a low resource country, exhibitied high innovative abilities in terms of industrialisation – consequently excelling in banking and insurance sectors. However, the first industrial nation could not continue its manufacturing lead from the last quarter of 19th century. By the middle of 20th century, the once global power became the ‘Sick Man of Europe’ compelling the government to take measures for reviving the manufacturing leadership post-wars.

Did British manufacturing sector lose its competitiveness because of protectionism, encouraging the companies to be proud of their manufacturing abilities and not necessarily other desirable practices like operational efficiency, economies of scale, economies of scope, innovations and being market-savvy? Was the British manufacturing sector suffering from complacency and active inertia? If no, why did it fail to develop competitive advantage in any of the industries? Has the national culture anything to do with British manufacturing sector’s competitiveness being eroded over the decades.

Pedagogical Objectives:

• To understand the historical context of factors responsible for British manufacturing sector’s competitiveness in early 19th century
• To understand how British manufacturing sector’s competitiveness eroded industry after industry and to debate on the reasons for the same
• To examine the role of government in revitalising British manufacturing sector’s competitiveness from time-to-time.

Keywords : UK Manufacturing, Competitive advantage of Nations, David Ricardo’s Theory of Comparative cost advantage, textile Industry, Iron and steel industry, Napoleon Wars, Laissez-faire policy, Mercantilism, English East India company, Industrial Revolution