The Economic Development of Russia to 1914 (NII)


Industrial transformation

From the mid-1890s, Russia's economy underwent a major transformation. The impressive expansion was initially masterminded by Witte between 1892 and 1903, who built on the policies established by Ivan Vyshnegradsky in the 1880s. 

Railway trackage virtually doubled, coal output in southern Russia jumped from 183 million puds (a Russian measure of weight) in 1890 to 671 million in 1900, and foreign investment soared, with France supplying a third of foreign capital, Britain 23%, Germany 20%, Belgium 14% and USA 5%.


  • He introduced a new rouble
  • Backed the value of gold 

In order to strengthen the currency and encourage foreign confidence and investment. The capital was used to fund public works, develop Russia's infrastructure- railways, telegraph lines and electrical plants- as well as develop mines, oilfields and forests for timber

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The state continued to buy out the smaller private railway companies, extending lines, so that by 1905, Russia had 59,616 kilometres of railways, 66% state owned. The growth rate was impressive and they helped to open up the Russian interior and allowed more extensive exploitation of Russia's raw materials. They also linked grain-growing areas to the Black Sea ports, so reinforcing the export drive.

The building of raiways stimulated the development of the iron and coal industries and permitted the development of new industries along the length of the expanding rail network.

Transport costs fell, bringing down the price of goods, while the government made money from freight (goods transported in bulk) charges and passenger fares.

From 1908-13, the rate of the railway building somewhat slowed. By 1913 Russia had the 2nd largest rail network in the world, with 62,000 km, although this fell short with the USA's 411,000 km.

Trans-Siberian Railway

A line which crossed Russia fromn west to east. Its building provided a huge industrial stimulus while the psychological boost, both at home and abroad, was even greater.

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Heavy Industry

In the early stages of the industrial growth, the lighter industries, particularly textiles, had led the way. Witte believed that, by concentrating production in key areas and by developing large factory units of over 1000 or so workers, big increases in heavy goods production could be achieved and this set the pattern for industrial development to 1914.

Russian oil production trebled from 153 million puds to almost 570 million between 1885-1913, and Russia became not only internally self sufficient, but also able to compete with the USA on the international market. Russia took 2nd place in the world of production and 4th in gold mining.

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Developments in Agriculture

Stolypin's Land Reforms:
He wanted the peasants to become the permanent owners of their land and they should be able to develop it as he wished without any interference by the mir. His reforms began in 1903, where the mir's responsability to pay taxes on behalf of all the peasants in the village was removed.

  • September 1906: More state and crown land is available for peasants to buy. Government subsities (funding) to encourage migration and settlment in Siberia are increased.
  • October 1906: Peasants are granted equal rights in their local administration
  • November 1906: Peasants are given the right to leave the commune. A new peasant' land bank is established to help peasants fund their land ownership.
  • 1 January 1907: Redemption payments are oficially abolished.
  • June 1910: All communes which had not redistributed land since 1861 are dissolved.

Grain prouction rose annually from 56 million tones in 1900 to 90 million by the end of 1914. A run of good harvests- particularly that of 1913 - also played a significant role in increasing production. In addition, Stolypin's encouragement in emigration took 3.5 million peasants away from the over-populated rural districts of the south and west to Siberia, and helped to develop Siberia into a major agricultural region 

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