Second Industrial Revolution - Germany

Germany

The German Empire came to rival Britain as Europe's primary industrial nation during this period. Since Germany industrialized later, it was able to model its factories after those of Britain, thus making more efficient use of its capital and avoiding legacy methods in its leap to the envelope of technology. Germany invested more heavily than the British in research, especially in chemistry, motors and electricity. The German concern system (known as Konzerne), being significantly concentrated, was able to make more efficient use of capital. Germany was not weighted down with an expensive worldwide empire that needed defense. Following Germany's annexation of Alsace-Lorraine in 1871, it absorbed parts of what had been France's industrial base.

By 1900 the German chemical industry dominated the world market for synthetic dyes. The three major firms BASF, Bayer and Hoechst produced several hundred different dyes, along with the five smaller firms. In 1913 these eight firms produced almost 90 percent of the world supply of dyestuffs and sold about 80 percent of their production abroad. The three major firms had also integrated upstream into the production of essential raw materials and they began to expand into other areas of chemistry such as pharmaceuticals, photographic film, agricultural chemicals and electrochemicals. Top-level decision-making was in the hands of professional salaried managers, leading Chandler to call the German dye companies "the world's first truly managerial industrial enterprises". There were many spinoffs from research—such as the pharmaceutical industry, which emerged from chemical research.