CHAPTER ONE.EVOLUTION OF SERF LABOR AT THE METAL INDUSTRYDURING THE 18-19th CENTURIES: THE CASE OF URAL

REGION IN RUSSIA.1

Beginning of Ural metal industry and initial organization of labor.

The evolutionary path of serf labor is rooted inthe aggregation of accumulated graduations andvariations in social activities. The complexity oftechnological and institutional changes is taken intoaccount. Description of these changes turns to be theprime purpose of this work, not focusing on moregeneral analytical issues of shift in mode ofproduction and distribution of surplus. Localizationand temporal concretization of research is of centralimportance. Although, it is necessary to keep in mindthat origin, adaptation and extinction of serf laborseem to be intelligible only in a wide historicalprospective, that includes diverse mutability of socialstructure and social interests.

Early metal production was organized in the form ofdomestic metal industry of peasants who were engaged inserfage. By the XV century its advanced part was

1 Improved version of the paper that was presented at the 16th

Annual Conference of European Association for EvolutionaryPolitical Economy "ECONOMIC THEORY, ECONOMIC DEVELOPMENT ANDHISTORICAL EVOLUTION", University of Crete at Rethymno, Greece,Session "Economic history", 28-31 October 2004.

gradually separated from agriculture, and those serfsconcentrated on metal production were to pay quitrentbased on the number of forges (Strumilin 1967, 28).This shows the process of division of labor within thefeudal institutional frameworks and modes ofenforcement that were drilled in rising industries.Production process had occurred irregularly, becauseonly the winter season allowed laborers to concentratecompletely on metal works. Summer time was busy so longas traditional households fastened people to farm-laboring. Even such handicraft technologies began toengage those workmen who carried feudal duties intoemployment by hiring.

The method of hiring the laborers proved itsefficiency after the technological transition fromsmall handicraft smithies to big size blast-furnaceswith the broad implementation of manual labor in theXVIII century.2 Technological superiority of blast-furnace industry over handicraft forges industrymanifested in bigger size of metal production withsaving energy and labor resources. But thistechnological transformation could happen only inrelevant social networks. Building and running theblast-furnace enterprise required a certainaccumulation of capital and labor resources. Besides,mass demand for metal output had to be created. Andthis transformation didn't meet in Russia suchobstacles as guild regulations of the handicraftenterprises. Consequently centralized metal manufactureeasily originated. By that moment the Russian rural

2 Blast-furnace metal industry in form of bloomery with highquality and high prices of metal become oriented on foreignmarkets, while the handicraft industry fit the needs of nationalconsumers of metal. And this division continued during the XVIIIand XIX centuries, with the exception of the state at agradually growing consumer of blast-furnace industry production.

metal industry could give enough qualified labor force,attracted by this form of employment.3

During the XVII century Russian blast-furnaceindustry in form of manufacturing was monopolized byDutch entrepreneurs who were granted concessions ofRussian government. These enterprises that wereaccommodated in central and northern Russia could drawthe labor only by hiring. And it supplanted moreexpensive labor of west-European artisans very soon(Strumilin 1967, 83). These industrial experiencesstrengthened the practice of wage employment assubstantial portion of laborers remained free fromserfage. On the other hand the rural handicraftindustry had evolved into patrimonial sort ofmanufacturing, originally for the natural internalneeds but later for the nation-wide market. Thisbusiness was explicitly and implicitly ruled bynobility, who used the labor of their serfs.4

Both forms of industrial organizations inmetallurgy kept closed for Russian entrepreneurs fromnot privileged social groups. But successfulcolonization of rich and depopulated Ural region duringXV-XVI centuries stimulated their interest in efficient3 Specificity of labor in metal industry was active use ofmachinery only as supplementary tools for chemical processes.Therefore qualitative change in making this industry a massproduction process depends on continuity of chemical reactions.Basic technological condition of this continuity wasimprovements of motive power. Blast-furnace with water-turbineenergy provided early form of continuous iron production.Pudding with steam-engine changed it to become more independenton additional works such as fuel and raw materials supply. Andonly electric motor almost denied the use of additional manuallabor at metallurgy.4 There is a difficulty to specify all sorts of labor relationsin Russian metal industry, because of the one-sided statisticsoriented on fiscal purposes of the feudal state. Only judicialforms of labor duties were fixed. And it was done following theinterests of factory-owners to cut their costs and enhance stateprotection (especially provisions supply for laborers).

outcomes from industrial developing. Fortunately,upcoming XVII and XVIII centuries were extremelyfavorable for development of the metal industry. And bythe end of the XVII century old metal regions ofcentral and northern Russia didn't fit the needs anddemands of military and industrial projects of a newgovernmental policy (Foltz 1998, 13).

With abundant mineral resources the Ural regionfelt a want of human resources for advanced industrialproduction. Density of population was one person per 10klm² and population growth reached 25% a decade(Strumilin 1967, 104-110).

As total administrative control over Ural regionbecame firmly established only in XVIII century,earlier resettlement from mainland Russia remained tobe risky and accidental (schismatic religious groups5,fugitive serfs and criminals, orphans, tramps, beggars,etc). Vast majority of migrants were out of feudal law.Therefore practice of using illegal labor was becomingwidespread phenomenon. This situation created specificincentive system both for entrepreneurs and laborerswith mixture of wage and compulsory methods ofenlisting the labor.

Absence of landlords and opportunity to settlelegally only with the governmental feudal duties werethe features of Ural region. Although governmentproclaimed state privileges on land, industrialdevelopment was opened to private initiative. Somescholars noted that absence of feudal land propertypromoted development of rural domestic metal industryat the regions of northern Russia and Ural (Strumilin

5 The only spontaneous flow of population consisted of religiousschismatic groups, who began to play a vital role for theindustry not only as workers, but managers and owners. Moreoverthey were supporting hiring their confessionals, creating stronginstitutional networks.

1967, 63). Government permitted entrepreneurs to usethe labor of any local settlers (if not runawaycriminals and robbers). But efficient state control wastoo costly to be an obstacle for illegal hiring. Inpractice migrants incrementally showed disrespect topower and rights of property, constantly harassing anyownership (aboriginal, state, etc.) by illegalappropriation. It was possible because central andlocal bureaucracy granted lands as a sign to thepersons who were unable to control them. On the otherhand, many peasants were escaping from reinforcement ofserfdom in central Russia that was made by illegitimatemethods.

Employed migrants usually received small land plotswith the rights for cutting woods down to build theirone-frame overcrowded houses. Nevertheless, they oftendwelt in earth-houses. Factory-owners cut costs, butchanced to put more obligations on workingmen toenforce them working for less payments. Total income ofindustrial laborers consisted of natural and monetarywages as well as household benefits. Many payments forlabor were made by factory-owners in natural form(bread, schools and churches, use of forests andfields, etc.). And only small amount of money was atworkmen disposal. But commonly they moved to moneylenders and merchants who granted them loans on thesecurity of their factory wages (Yourin 1998, 725-726).Workmen cultivated only vegetables, and bread or otherprovisioning they got from factory owners or bought.

Natural payments were to insure living minimum.They depended on the size of the family and wereneutral to individual qualification and productivity.This situation attracted people because of guaranteedprovisioning for children and aged in the families thatwere used at industrial works, and even stimulated thepractice of adoptions that was interesting both forlaborers and factory administration.

Aggregate life time, including factory works,agricultural and household activities, was aimed tofeed and defend survival of a person. Free time fortheir individual interests was absent. Structure andmode of nutrition characterized informal dependentstatus of laborers in social structure. "Dry, bring-from-home" mode of nutrition have dominated.Controlling the food and cloths supply, factory-ownersincreased workmen's dependency by payments on account,making them debtors. Factory-owners made arbitraryprices on these goods, and therefore workingmen's debtsalways rose.

In the XVII century after the severe economiccrisis in central Russia natural quitrent wassubstituted by monetary one that was fixed in a newfeudal code. Labor exploitation increased and manypeasants started migration to the east, at Ural region.The colonization stream glided from north to south ofUral. Originally migrants came from northern Russia,but since XVIII century - from central agriculturalregions. As a result, urban population consisted frommigrants from central Russia, who were compulsorydeported serfs, and rural population consisted mainlyof early migrants from northern Russia, who belonged tothe state (Golikova 2000, 31-37). For instance, in 1795at the district of Cheliabinsk among 82.808 inhabitantsthere were peasants - 51.577 (62,3%), service class -29.474 (35,6%), others - 1.778 (2.1%); and in structureof peasantry: state peasants - 42.926 (51,8%), economicpeasantry - 7.947 (9%), manor peasantry - 704 (0,9%)(Tarasov 1984, 48).

A unified form of serfdom had beeninstitutionalized in feudal code in 1649. Agriculturallabor practices of peasants produced their need inland. But feudal land ownership pushed peasants intoserfdom. Serf dependency of labor population of Russiabecome complete but due to the feudal structure of

ownership property rights on this labor was variableaccording to status hierarchy of owners.6 Peasants havemany duties: poll-tax (capitation), metayage, statecorvee (labor rent), public rent (administrative andcommunal), natural duties (recruiting, delivery ofmetayage provisions, building bridges, forts andvessels). In general, surplus serf labor was separatedin time and space from the labor necessary forreproduction of labor force an initially was includedin production process as directly (socially) exploitedlabor.

Agricultural productivity by that time was low andquitrent equated 20% of the corp. Nevertheless, crisisof feudal economy resulted in wealth differentiation ofpopulation and many peasants were trying to be employedto pay quitrents or to escape on new lands. Shift fromnatural rent to monetary rent started at XVI, but onlyat XVIII during the reforms of Peter I monetary poll-tax become universal. It means increasing the role ofcentral power in distributing the property rights onlabor. But practice of hiring mainly illegal migrantsat Ural industries had high transaction costs and leftstate out of control.

At the first quarter of the XVIII century most ofUral metal enterprises belonged to the state and onlyfew were private. State was trying to combine hiringthe high skillful laborers with recruiting for

6 In this article serf labor means special mode of laborenforcement that contains an institutional networks ofdistributing the bundle of privileged property rights on laborand determine the processes of production, appropriation anddistribution of surplus. Its basic attributes are politicalconditioning of property rights, laborers bondage on basis ofland ownership, and laborers ownership on instruments.Additional features include lack of competitive labor market,rental labor motivation, patriarchal family, legal subordinationof laborer to master, feudal dominion over production andconsumption.

additional manual works. But this type of organizationcould survive only exceptional political circumstanceswith high transaction costs that could be covered bygovernment for military purposes. At these factoriesall labor relations were under the administrativecontrol of feudal bureaucracy with specific rent-seeking behavior, and method of distributing theproperty rights on labor looked to be very fragile andpolitically sensitive. In long-run process of adoptingindustrial technologies to feudal social structuresthis method couldn't successfully compete with privateenterprises.

At 1717 government prohibited small rural metalindustry to enforce adept peasants to go at the largestate and noble factories (Petrovskaya 1960, 20-21;Golikova 2000, 85). Since peasants disagreed with thisregulation and could disturb it in poor populatedregion of Ural, big entrepreneurs compromised andagreed to pay them for iron-ore. In fact this measureworked not against small peasant industry, thatcouldn't survive because of the higher production costsand lower quality, but because of the interests incontrol of the limited labor and mineral resources.

In fact Ural inhabitants, who possessed averageplots of land, were not interested to be hired at theMetal factories (Petrovskaya 1960, 24). While trying toengage labor force from the other Russian regions Uralmetal entrepreneurs met "free-rider problem". Many ofpotential roustabouts have disappeared with advancemoney. Entrepreneurs had count one forth of all coststo be of this kind (Golikova 2000, 43).

Plenty of military campaigns of Peter Iincrementally demanded production of metal industry.According to Strumilin (Strumilin 1967, 258), despitethe high costs of labor enforcement factory-ownerscould benefited because of the good conjuncture formetal industry. At the period of 1719-1725 iron

production at Ural region raised on 46% that is thehighest rate of growth before the XX century (Strumilin1967, 154).

In the networks of feudal institutions hiringcommonly resulted in creation of serf dependency. Evenfree hired labor in the feudal environment experiencedserf methods of enforcement including sticks, whips andirons. Personal job contracting easily was transformedinto rights on persons (Man'kov 1980, 126). Propertyrights on labor in hiring were poorly defined before1725. Therefore they were defined by feudal measures ofserf dependency.

After the failure of regular attracting theindependent but illegal laborers, government decided in1721 to use serf labor for industrial enterprises. Onlyin managing and engineering of metallurgy personscontinued to be personally independent. Rarely did ithappen with artisans. This step together with someother political decisions about manufacturing put itunder the tough control of bureaucracy, since majorityof laborers carried the feudal dues to the state thatmeans free choice of place of residence, type of worksand labor instruments. State also supported the flowand accumulation of capital in industry.

Privileges as well as costs of serf labor weredivided between feudal bureaucracy and entrepreneurs.Feudal government received quitrent and entrepreneursgot profit from hiring serf labor at industrialenterprises: surplus product constituted from twoparts. Price that entrepreneur paid for the use ofserfs (their quitrent) was much lower then prices ofhiring, even together with additional costs of theirprovisioning and wages. And such industrial use of serflabor in Ural region was more profitable and attractivethan agricultural one. Norms of serf labor becomeregulated by administrated wage-rates. Despite thepermanents administrative reevaluations serf wages were

two times the free-contracting wages (Strumilin 1967,98). At the same time, prices of free labor hadincreased constantly because of the rising demand onlabor force and growing inflow of cheap serf labor. Itis important to note that, serf laborers in industryworked mainly in count of feudal dues, but only then -for wages.

Amounts of work of attached peasants depended onthe size of poll-tax. Commonly laborers to be attachedreceived factorial lands for building houses, market-gardening, haying. During summer hay-making timefactories desisted to make workmen participate inhaying for their cattle. Working season (time of usingpeasant labor in industry) was determined bygovernment. Working operations to be done by serflaborers were regulated by government too. As metalindustry grew up during the XVIII century, serf laborgot more institutionalized in sense of normativenetworking.

Ural metallurgy was based on the energy of water,wood and charcoal. So it required certain amount ofadditional manual labor to be used for energeticpurposes of metal enterprises. Usually metalenterprises were self sufficient with fuel and rawmaterials. Sometimes supply of raw materials wasprovided by other private entrepreneurs. But in generalit is correct to model Ural metal enterprise as a unitof separate technological operations that included allpreliminary and supplementary stages of productionprocess. Metal enterprises had their mines, forestry,hayfields, mills, stables, docks, vessels, workshops.Hence all those works demanded simpler and moremechanical types of skill and seasonal calendar. Majorpeasant works were in the spheres of fuel, rawmaterials, and transportation. Stability oftechnologies created constant demand on certain fueland low-qualified labor force. Easy access to raw

materials backed up this demand too. Finally for manyfactories reducing the coal expenditure was moreimportant than increasing the melt (Komratov 1998,257).

Privatization of Ural Metal Industry and property rights on labor.

After the rule of Peter I in Russian economicpolicy dominated practice of favoritism, i. e.monopolies as political privileges of certain economicagents. New state bureaucracy increased its engagementinto the business of distributing privileges andprivatizing state enterprises. For instance, suchprivileges in metallurgy were given to Saxon baron FonSchemberg because he shared this income with regentBiron and Empress Anna Ioanovna. Since the middle ofthe XVIII century the harm of monopolies and corruptionwas recognized, and government allowed all socialgroups to participate in industrial entrepreneurship(Nikitina 2001, 110). Bit in this historicalcircumstances only noble entrepreneurship had directaccess to serf labor that supported their temporaryinterest. Industrial labor was reckoned up 50-60%profitable, while agricultural - only 6-7% (Strumilin1967, 220-221). Therefore feudal owners tried to buyindustrial enterprises.

Practice of noble entrepreneurship in Ural metalindustry created special constraints for distributionof the property rights on labor. This method was lessefficient then enterprises of feudal state. This methodreduced the status of serfs close to the status ofslaves, concentrating rights on labor in hands ofnobles. Here only symbolic rights on their personalityand motive of survival formed incentive system for serflaborers. Introduction of wage motive for those serfsdidn't change the serf system of distributing the

property rights on labor and just increased the costsfor noble entrepreneurs. Nobles were poorly motivatedto act as capitalist employers constantly harassing thelabor rights of employees. Feudal statuses of masterand serf damped down development of capitalistbargaining. Consequently noble metal enterprises didn'tadapt to existing social structure and mutated soon.After 1750s most of them changed their owners ordisappeared.

Because of the high mortality rate among workers ofmetal industry, labor force could be reproduced on alarger scale only with the constant inflow from therural Russia.

Since 1726 according to innovation of compulsorymilitary service in Russia certain amount of industriallaborers (18,4%) become recruits, who were attached tofactories for military duties and received wages exceptarmy provisioning (Strumilin 1967, 251). Entrepreneursgot rights to attach most skillful persons from anysocial groups as artisans for wages but with obligationto abide at particular factory. At 1745 industrialrecruits at state factories reached 70% of labor force,while twenty years earlier they were only 27%(Strumilin 1967, 281-283). Recruits were devoted onlyto additional unskilled works, and were close in theirstatus to state serfs allotted to the factories. It wasapolitical measure of the feudal state to solve theproblems of prompt growth of military expenditures.

At the first half of the XVIII century in Uralmetallurgy only 12% of industrial labor force wasmotivated by feudal obligations and 88% - by wages(Strumilin 1967, 265). But at the same time factory-owners were trying to attach with feudal duties mostqualified workmen. And for instance, in 1736 and in1755 government advocated this entrepreneurial interestby attaching few thousand employees although withoutrights to sale them. Feudal institutional networks

dictated the rules of serf dependency and stimulatedprocess of constant attachment of somehow liberatedpeople.

Factory-owners have an interest in changing legalstatus of industrial laborers and accepted additionalcosts of fixing them as serfs. As a result it becomespossible to extract both rent and profit fromexploiting this labor force. This was conditioned bytechnologies with dominance of manual, low-qualifiedseasonal drudgery.

Bloomery process required experiences and skills ofmanual labor. Komratov explains the process ofaccumulation and improvement of craftsmanship byserfdom. Generations of bloomery masters remained at asingle place and experienced in certain elements ofproduction. This sort of technology protectedconnections of labor with factory. (Komratov 1998, 253-254). Rules and customs at Ural metal factories were tomake unpaid labor enforced. They have overseers,corporal punishments, cheating with payments. Factorymanagers administered justice and met out punishment.It was possible when key labor roles equated to thearmy ranks. As citizens of feudal Russia they sworeallegiance to tzar.

During the second quarter of the XVIII centurygovernment introduced actions to legitimate illegallyhired persons and increase compulsory labor in Uralmetallurgy. State factories were oriented on statepeasants, and private factories - on manorial serfs,that had similar status to state peasants. They belongto the factories and were unallienated from them. Maindifference emerged in sphere of state influence. Inpractice government didn't interfere into the processof organization of labor at private enterprises. Onlystate enterprises were strictly regulated by universalnorms of labor process.

This specific type of industrial organization were

called in 1736 "possessional manufacturing", that wasbased on attaching the villages to the factories. Itwas a lawfully sanctioned symbiosis of serfdom andhiring, a sort of transitional form to liberating thelabor from feudal obligations. Possessional form ofindustrial enterprise successfully institutionalizedcombination of two methods of distributing propertyrights on labor. Such a form lingered more than acentury and was officially canceled only at 1840.

Possessional form of manufacturing, that requiresgovernmental allowances for various kinds of motiveforce, defended adherence to traditional labor-intensive energetic system. And during the XVIIIcentury the portion of manual labor in metal industryhad gradually risen (Strumilin 1967, 174).

Laborers of possessional enterprises had personalplot and monetary wage, but were attached to theproperty of the factory-owner. Actually they alreadyproduced not only feudal profit (rent) but capitalistprofit. These enterprises were a part of growing marketnetwork that was substituting feudal economic networkstogether with pre-capitalist forms of surplusproduction. Feudal rent as an income was produced bycompulsory unpaid labor, and capitalist profit - byvolunteer paid labor. Technologically, compulsory laborwas linked with mechanical skill, manual works,peasant's property on instruments, while voluntarylabor was executed with special skills at blast-furnaces that belonged to the factory-owner. Wagepractices at additional works didn't reshapesubstantial serfage organization, and attempts to putfeudal dues on trained and qualified laborers failedbecause of absence of motivation.

Price of compulsory labor was administrativelydetermined while price of contractual labor depended onmarket. At the middle of the XVIII century compulsorylabor was estimated two-ten times cheaper (Golikova

2000, 67). For institutional research it is essential to find

how did through evolutionary path wage become a mainlabor motivation, making feudal dues supplementary forlaborers interests in Ural metal industry.

In case of serfs, both elements of contractual andstatutory enforcement took place. Labor operations andworking tasks become more specified and individualizedin payments, but included into the traditional socialnetworks. Factory administration used to enforcepeasants to make not only their personal duties butaccording to communal rules of mutual responsibilityadded duties of all persons registered at theparticular rural community. As a result amounts oflabor operations increased by the numbers of children,disabled, aged and dead people. Contrary, peasantsconstantly demanded the personalization of theirobligations.

In the story about Staroutkinskyi factory RybnikovP.G. gave the following characteristic picture(Rybnikov 1998, 338-341). Organization of labor wasbased on patriarchal traditions. Fathers wereresponsible for education of young generations. Moreproficient and educated become masters, merchants,employees, free from serfdom and hired to work forwage. Other laborers were seasonal and have piece-workpayment. Majority if population were half-workers andhalf-peasants. Separately both industrial earnings andsmall rural households were not enough to survive.Those people usually own houses with stove and lands,horse, cow, small cattle, agricultural implements. Menwere responsible for keeping the house, ploughing,laying-in of fodder and firewood; women - for market-gardening, care of cattle, field-works, tailoring andnursing. Besides, both were engaged in householdmaintenance of tools and training their children.Sometimes groups of allotted peasants lived up to 500

km from away from the factory. Artisans were obliged towork 35 years at the factory, and recruits - 25 years.

Extortion of feudal rent from forced industriallabor was based on protection of agricultural interestof peasants. Since industrial works were done under theownership of entrepreneur, obligation of quitrentpayments moved from allotted peasants to factoryowners. But transfer of feudal dues increased therights of factory-owners to exploit allotted peasants.

At 1763 the right to buy serf labor was spread onforeigners, and at 1759 government gave all privateentrepreneurs the rights to buy serf labor, thatequalized economic agents in access to feudallydependent peasantry. Those actions strengthenedprevious small steps in widening the social segment offactory-owners.

On the other extreme, feudal governmentstrengthened serf dependency of populace in general.And increasing of industrial obligations was acceptedas a temporary political measure. But laborers react onit differently from intricate adaptation to aggressiveseizure.

Many of serfs solved the problems of theirindustrial dues by hiring others for them, andconcentrating on their private agricultural works.Factory and state officials accepted such actionsbecause it worked and affected the practice of mutualresponsibility among peasants that turned to providelabor process of its representatives despite anyaccidents (illness, death, shirking, etc). Thereforeentrepreneurs could always find those persons to put onthe existing norms of labor feudal obligations.Furthermore, it was a process of division of labor,when some specialized on agriculture and accumulatedland plots, and others sold land plots and become hiredat industry.

Lack of necessary financial resources not onlyforced to use serf labor but prompted factory-owners toeconomize on labor costs. Customs of managerialcheating with all sorts of payments were widespread atUral region (Kalmykova 1998, 611-613). In practice onlyone thing could discontinue cruelties of enforcementand cheating - organized defense of labor rights. Itsucceeded rarely but in few cases owners and managersmade concessions and compromises, concerning methods oflabor enforcement but not its social essence. Moreoften, laborers exercised non-resistance to force andturned to cheating with norms of their works. The samedid factory administration but in opposite direction.Besides, ruling the process of distribution of works,lands, provision, etc, administration tried to persuadeallotted peasants to bribe. And sometimes it gives moreimportant source of income than economizing industrialenterprise. So these networks created stratum ofinterests, among those engaged in metal industry,neutral to success of the whole enterprise.

Factory-owners spread practices of serfdom on thestate peasants, who participated in their business.These damages of peasant’s rights showed adaptation ofserf enforcement to non-serf surroundings of thefactories. But peasants were also active in resistance.They took part in organized local riots, escaped,committed sabotage of industrial labor, complained tocentral government. Especially influential were actionsof those who supported peasantry army of Pougachev -largest rebellion of the century in Russia. Period of1760-1770 was a time of most aggressive movements ofworkingmen at Ural region. Afterwards, in 1779governmental manifesto restricted serf labor byadditional operations that didn't need skills,increased twice wage-rates of industrial serfs andreduced industrial quitrent, which was completelyabolished at 1800 (Golikova 2000, 58). In general,

during 1780-1790 state peasants allotted to the metalfactories become less dependent from factory-owners,because administrative reform created a system of legaland financial control over industrial enterprises.

During the first quarter of the XVIII century 10private and 13 state factories were founded, during thesecond quarter - 34 private and 14 state, during thesecond half - 96 private and 5 state (Foltz 1998, 14-15). At the 1780 Russia become the world leader in ironproduction. High quality and cheap prices made thismetal very demanded at world markets. Nevertheless, atthe second quarter of the XVIII century bothinternational and national conjuncture for metalindustry become less beneficial for Ural enterprises,and huge amount of serf labor looked to be very costlyfor factory-owners.

Technological and organizational changes at the first half of the XIXcentury.

At the beginning of the XIX century bloomeryprocess had being changed by pudding process7, whichmade a strong support to renewing the organization ofunqualified labor. On the other hand, technology hadmoved from the water energy to the steam energy thataffected concentration of various productive stages andspecialization of labor. At Ural region first puddingproduction started working since 1837 and appeared tobe much more expensive than bloomery. As a result,until 1860s bloomery technology prevailed in the

7 Pudding being invented in 1766-67 in Britain substituted theprevious forms of metal technologies by the end of the XVIIIcentury. It was congenial to industrial organization of labor inBritain and bituminous coal fuel inherent in Britain. Newtechnological process had a steam-engine. Besides it couldbridge the gap between lower quality British and higher qualityUralish iron-ore.

region. Technological restructuring of Ural metalindustry went slow and Russia had been increasing itstotal production only because of the new industrialregions, basically located in the south-west.Nevertheless until the 1890s Ural industry stilldominated in amount of metal production on the Russiannational market.

First quarter of the XIX century was very hard forRussian metal industry, its production reduced up to20% and use of serf labor become more demanded thandecade ago. To fulfill tasks of unskilled worksgovernment advocated return to feudal measures of massemployment. Only status of serfs at industrialenterprises altered, introducing various groups oflaborers. Instruments of supplementary works continuedto be primitive. Until 1830s laying-in of firewood hadaccomplished with the use of axe. Introduction of sawshad been increasing productivity of labor in 2-2,5times but goes slowly until the second half of the XIXcentury (Golikova 2000, 53). Metal factories were mostactive during spring and fall time. "Due to the lack ofthe water in ponds, bursting the dams by spring floods,repairing the blast-furnaces, etc., metal factories ofUral at XVIII almost annually didn't work from 2-3 to 6and more months" (Gavrilov 1985, 172). Costs of usingcompulsory labor fallen down the costs of usingvoluntary labor. Therefore the portion of hired laborreached the lowest level (Strumilin 1967, 325).Reorganization and intensification of serf labor couldtemporary solve the problems of technical stagnation.Positive result came very soon. Largest growth ofRussian metal industry had occurred at 1833-1860,especially during 1850s when iron production rose on57% (Strumilin 1967, 332).

State edict of 1807 ordered new statuses of"indispensable" and "indigene" workers to be introducedinto practice at 1813 and 1814 respectively.

"Indispensable" workers were represented by a groupof serf peasants (about 5-10% of total), who wereallotted to the factories but not to factory-owners andsent (mainly from central Russia) to perform industrialworks. It helped specialization of labor force andliberating them from agricultural works. Basically theywere engaged into supplementary works. Their toillasted for 12-14 hours daily for the salary lower thantheir life costs. Therefore labor enforcement was notfree from feudal tools. According to Yurin"indispensable" workers economized up to 15 percent oflabor only at supplementary works (Yourin 1998, 727-728). They have to work at the factory 30 years andtheir children - 40 years. Since majority of peasantswere liberated from direct factorial works, localcommunities were to pick out "indispensable" workers.At the Ural region 217.115 liberated peasants providedfactories with 17.850 workers (Petrovskaya 1960, 25-26).

Role and circumstances of "indispensable" labordiversified due to social conditions. Someentrepreneurs reject them but others favored. Althoughnew sort of laborers substituted the former one, thelist of obligatory works increased, they were moreflexible for factory needs. Status of «indispensable»workers becomes close to artisans, but they lived atcosts and by norms of their rural communities and hadno specific industrial skills.

Similar to status of "indispensable" workers atstate factories was a group of "indigene" workers. Theywere attached to private factories for additionalunqualified manual operations. Those two groups ofworkingmen had substituted serfs especially inproduction of firewood. But this change was rooted notin technological changes and rise of qualified workers,but in fiscal tendency to give unskilled hands a statusof artisans. As a result, during the first half of the

XIX century Ural metal industry had three times moreartisans than "indispensable" workers and this gap hadincreased.

The truth was that at the first half of the XIXcentury tendency to substitute serf labor by hiredlabor in providing raw materials clearly showed up(Golikova 2000, 61). Former method of distributing theproperty rights on labor was gradually loosing motivestrength. There was a need to weaken feudal compulsoryform of dependency.

In 1819 government had limited the rights over serflabor on state enterprises. In practice they lostrights to sale serfs separately from their enterpriseor to transfer them to another enterprise, to divide orto change manufacturing properties. Government acceptedthe rights of laborers in regime of their work, and incases of abuse enterprises were appropriated by thestate. On the other hand, government allowedentrepreneurs to fire serf laborers with the ministrypermission since 1824, and since 1840 - to liberatepossessional laborers, making them employed accordingtheir own will. The portion of serfs among all Russianpopulation was in 1766 - 45%, and in 1860 - 37,5%, andat Ural region in 1782 - 18%, in 1850 - 13% (Strumilin1967, 235-236).

At the first half of the XIX century factoryadministration recognized superiority of piece-workpayments over compulsory duties as incentive systems.Entrepreneurs as major economic agents of metalindustry recognized real benefits of independent laborforce. Factory-owners obtained reducing the summerbreak to less than one month. Most of the factoriesreduced working time up to 8 hours per day. Someenterprises organized short shifts (6 hours) to attractmore labor force and detached it to the factory.Anyhow, during the first half of the XIX centuryaverage workmen reduced his working day on 2 hours.

Factory-owners used deposit to attract peasants totheir factories and to prevent them from agriculturalhousehold workings. Indebted peasants gradually movedto the worker's settlements and concentrated onindustrial labor to fulfill their financialobligations.

At the middle of the XIX century Ural metalindustry with outdated technologies and serf laborstill were paying concerns (Strumilin 1967, 217).Double control over hiring process hadinstitutionalized: factory administration and localcivil organizations (Golikova 2000, 62).

At that time almost 40 percent of labor force inUral metal industry was hired workers. And movement fortheir rights and living standards become more organizedthan before. But for the purposes of survival they seekto increase land plots. At Ural region main landownership belongs to state and not to peasants. Butwide rights and privileges of factory managers turnedthis ownership against agricultural interests. Most ofpeasant households by the beginning of the XIX centuryreoriented on cattle-breeding that was useful foradditional industrial work itself. Cattle orientationgave more free time to be used for industrial works.Besides only few southern districts were disposed toplant-breeding. This rural change conformed to theinterest of industrial organization of the region. Andat that time factory-owners provided workmen (artisansand hands) with the land plots to adopt interests ofmetal industry to pre-capitalist social institutions.

System of serf labor in Ural metal industryoriented workingmen on rotation of labor operations upto the orders of factory-owners. Therefore it wasdifficult to develop professional skills andqualifications. But cheap labor and low mechanizationguarded this system. Labor time was limited only byphysical possibilities of people. They worked 12 hours

daily or 24 hours per two days (Gavrilov 1985, 149).But such travail was not intensive. Moreover, in Russiathere were too many holidays.

During the XIX century demographic processes in theregion showed the growth of population. Affluence oflabor force resulted in latent unemployment in form ofso called "outdoor days", i.e. practice of labor-leisure alternation among the groups of workmen(Kalmykova 1998, 627). Besides allotted workers wereenlisted not only industrial labor itself but any sortsof supplementary works.

According to the Mining Statute, regulating laborin mining and metallurgy, since the second quarter ifthe XIX century child labor become obliged for thosefrom the families of constant workmen at the Uralindustry. And at the 1850s about one third of labor waschildish (Gavrilov 1985, 78). Only in 1860s governmenthad curbed the use of child labor to cease its constantgrowth. At 1860-1870 only quarter of workers werechild, and at 1880-1890 - less than 5%. Female laborwas not so wide spread because of the difficulties ofmetal works. Although since 1960s there was a tendencyto increase its part, it never reaches more than 10% oflabor force.

During the XIX century Ural family had evolved frombig patriarchal unit to small nuclear unit (Gavrilov1985, 98). At the first half of the century earlymarriages dominated. Rules of serfdom acted todistribute provisions according to the numbers offamily members. Besides it increases the laborpotential of the family, especially in thehousekeeping. If rural marriages were early with femaleage superiority, factorial marriages become later withmale age superiority. And fertility age dependedstrongly on compulsory forces like per capitaprovisioning or universal military obligation (Golikova2000, 108).

In 1858 at Ural metal industry there were 329.354serf males, 145.484 persons (42,2%) - possessional,96.043 persons (29,1%) - fiscal, or state, 87. 827persons (26,7%) - private. But in fact almost half ofthem didn't participate in active labor. And only about20-25% of active labor force was qualified full-timeworkers (30.000-38.000 people). It was a need forsystem of serfdom to consume labor force unanimouslyeven without sufficient productive results.

Abolition of serfdom and capitalist trends in Ural Metal Industry atthe second half of the XIX century.

The crucial point in evolution of industrial laborin metallurgy was abolition of serfdom at 1861. Itcreated new problems for the Ural metal industry,because most of the working people in reality continueto be (informally) attached to their enterprises. Theyhad no alternatives to use their labor force and touphold their lives. Although relations betweenentrepreneurs and laborers became close to bargainingand contracting, but it had no impact on the wagelevel. On the other hand, fast rising economic regionat the southern Russia, competing with the Ural metalindustry, decrees laborers salary and motivated them tospend more time at their households. Consequentlycapitalist form of labor enforcement didn't comecertainly. Only at the beginning of the XX century theUral region become attractive for the foreign capitalas source of qualified free labor force that was a signof adopting labor organization to the rules ofcapitalist market.

Abolition reform crushed institutional obstaclesfor technological restructuring, mainly for new types

of motors. During the second half of the century inRussian metal industry the portion of water energyreduced from 91% to 15% (Strumilin 1967, 359). But thischange took place due to the building the new factoriesat a new regions. Ural still suffered from low price oflabor force and lack of capital. Wooden fuel was almostfree for factory-owners and labor become affluent andcheap because of the rationalization of additionalworks

According to reform of 1861 factory-owners mustgive their artisans land plots. But their sizes were sosmall that most people refused to take them. Andfactory-owners allowed any factory laborers to usetheir forests, hayfields and plough fields almost forfree (Kozhevnikov 1998, 537). Even at the end of theXIX century Ural factory-owners still were majorlandowners as well. Every factory has an average of270.000 acres of land, and the richest - up to20.250.000 acres (Gavrilov 1985, 5-6).

According to the principles of reform artisans gotparcels of land for housing, for ploughing, and forhaymaking. But by the end of the century the numbers ofworkers-with-parcels reduced. For instance, in Permdistrict 84,4% of artisans had no parcels and more thana half of additional hands had less than 2,7 acres peradult person, and in Ekaterinburg district 88,9% werelandless (Gavrilov 1985, 71, 138). More intensive laborgave fewer opportunities for agricultural works at thehouseholds. And modernization of technologies andmachinery reduced interests of workingmen in additionalagricultural works. But most of factory ownersprotected those interests for the sake of cheapeningthe labor.

Activity if basic economic agents in metallurgyafter reform created a system of specific rent aimed tocontrol an access over the labor resources. And inreality it helped keeping wages low because of informal

detachment of workmen to those lands and inability tosurvive by farming. On the other hand, factory-ownerswere lobbying the law that prohibited domestic metalindustry to close workmen any ways from theirenterprises to small private businesses.

All those social conditions defended embeddednessof serf labor even after its legitimate abolition. Butthey were not the only factors. "Decisive role inweakening ties of workers with land have the evolutionof small-scale commodity production and manufacturinginto large-scale machine production" (Gavrilov 1985,136).

New technologies, based on substitution ofvegetable fuel by mineral fuel, and later on methods ofBessemer, Marten, Tomas, were not widely practiced inRussian metal industry. Russians oriented on theirinternal governmental demand, high quality of ore andcheap serf labor. And giant progress in Metal industryof Britain, Germany and USA made during the first halfof the XIX century had not been made by Russianindustry. Only by the end of the century this progresstranspired here but on new technologies at other metalregions than Ural. And Ural metal industry still hadmorally old technologies and lack of mineral fuel. Newtechnologies required more concentration and morestable demand. But metal industry was dependent onforeign engineering industry that advocatedtechnological innovations.

During XVIII-XIX labor demand was always higherthan labor supply. Only after relative equalization ofdemand and supply at the middle of the century, hiringcould be exercised widely on a mutuality of interests.Before that peasants acted as if they didn't acceptindustrial obligations as legal duties, but asgovernmental compulsory and temporary measures. Andgradually this attitude motivated conflicts aboutindustrial dues of peasants and helped to create norms

and regulations of the serf industrial labor.Despite the growth of productivity in metal

industry the numbers of additional hands reducedbecause of wide introduction of hiring (Golikova 2000,27). During 1860-1864 number of workers in metalindustry of Russia reduced twice and amounts ofproduction increased on 45% (Strumilin 1967, 344). Eachthird worker lost his job (66.000 men) (Petrovskaya1960, 36). Just in five years after abolition quantityof Ural metal labor force reduced on 25% but by the endof the century risen on 100% (Gavrilov 1985, 33-39).

In 1900 there were 230.591 workers in Ural metalindustry (50% of all Ural and 15% of all Russianindustrial workers), and 87.406 (37,9%) people -employed at the factory, 143.185 (62,1%) - atadditional works (Gavrilov 1985, 41-46).

Social structure of labor force had changeddramatically. The parts of child and aged workersdecreased. It can be explained by rise of workersliving standards (Gavrilov 89). As a result numbers ofeducated workmen with high cultural interests hadincreased. At the last decade of the XIX century mostof worker's settlements have clubs and libraries. Butmajority of workingmen continued to practicepatriarchal forms of spending leisure-time: evening-parties, youth gatherings, skits, cards playing,scuffles, hard drinking, etc. Most of Ural factorieswere active about 240-250 days annually, and averageworker had only 214 working days (2247 hours) per year(Gavrilov 1985, 173, 177).

During the second half of the XIX century wages ofworkers increased highly together with their level oflife. But according to Kalmykova, at the 1890s averageworking families at metal factories didn't get enoughearnings for survival (Kalmykova 1998, 628). Analysisof laborers family budgets (Gavrilov 1985, 218-229)shows that 60-80% of family expenses were spent on

food; tendency to increase clothes expenses (15-25%)emerged; household expenses reached 10-20%. Structureof nutrition had changed. Amounts of rye bread,potatoes, and cabbage reduced almost twice, amounts ofmeat, fish, and vegetable oil increased, and new food-stuffs (sugar, tea, white bread) appeared. Housing oflaborers has improved when after 1861 houses with plotscould be privatized by workmen. Partly they becomebuilding better two-framed houses, but partly theybecome homeless. And factory-owners lodged them inspecial barracks (5-10% of workers). During the secondhalf of the XIX century early marriages among Uralworking people become rare. The main reason was therise of cultural and life level. Besides introducingcompulsory military service government increased theage of average marriage.

Incremental change of social status of laborerstowards proletarianization influenced the system ofdistributing the property rights. New interests and newforms of dependency involved in Ural metal industryshowed hostility to multiple property rights on labor.Market forces constituted the conditions of decline forcompulsory labor system.

 At the second half of the XIX century Ural havebeen loosing its dominance in Russian metallurgy,producing 71 percent of iron in 1860 and 28 percent -in 1900 (Foltz 1998, 17). There was a period of highgrowth in both industrial productivity and population.Despite the gradual rise of production, Russian metalindustry had shifted during the XIX century from secondplace to fourth, and lost western markets.

Evolution of labor from serfdom to hiring resultedin rise of amount and diversity of wages. Gavrilov D.V.(Gavrilov 1985, 191-192) explained it by temporary highprices on bread, introduction of piece-work payments,labor intensification, technical improvements, worker'sstruggle for rights and wages.

Factory-owners started to back the rise ofspecialization and qualification of labor. Basicworkmen become full-time employees. But since technicalreorganization of Ural metal industry went very costly,quality of labor force increased slowly and greatamount of additional works continued to exist. At metalfactories qualified workers constituted about 50-70%(Gavrilov 1985, 120). It can be explained by the usageof charcoal fuel that created the need in additionallow qualified labor (up to 60% of workers).

In Russia the period of monopolist capitalism beganat the end of XIX. Its main features were the dominanceof giant enterprises in certain industries, inflow offoreign capital, and creation of financial capitalcontrol in economy. During the last 10 years of the XIXcentury amount of industrial production had risen on100%. Apparently capitalist development of Uralmetallurgy becomes possible. It resulted in inflow ofjoin-stock and foreign forms of capital. In 1900 about50 percent of Ural metal enterprises were join-stockand in 1917 - 98 percent (Foltz 1998, 17).

Second half of the XIX century demonstrated overalltransition to new contracting arrangements in Uralmetal industry. Former serf laborers become extinct asresult of employment on basis of labor trade. Employerspicked trade but not bondage because of its efficiency.And laborers position evolved since they lost aninterest and right on land property that was anattribute of serf status. Ural metal industry faced theprocess of incremental proletarianization of workingpopulation. The pattern of distribution of rights onlabor had changed in direction of capitalistinstitutional network.

North view the gradual demise of the traditionalagreement of lord and serf as a result in altering theopportunity and increasing the bargaining power ofserfs that occurred on basis of radical population

decline (North 1990, 89, 96). For Ural metallurgypopulation factor was important but not decisive.Moreover population tendency seems to be an opposite.Industrial entrepreneurs constantly faced the lack oflabor force in the region. What was essential anevolution of social structure, system of distributingproperty rights on labor and interests of economicagents.

Conclusion.

Resource problem locked the system of labororganization in Ural metal industry into the evolvingpath that was not optimal to wide historicalprospective. Introduction of serf dependency inindustrial labor made it better suited to theinstitutional environment of feudal-absolutist Russia.Origin of some institutions was strongly related totechnologies. Energetic problem of metal industryplayed decisive role in survival of manual unskilledlabor that could be extensively exploited by methods ofserfage. Organization of serf labor had highly mutableforms. All its mutations represent attempts to adaptthe system of distribution of property rights on laborto changing social structure, which was a part of moregeneral evolution of the surplus production system.Possessional manufactory turned to be the mostefficient form, because it combined both compulsory andvoluntary incentive systems. But its transitionalnature manifested through the transformation of Russiansocial structure. As a feudal production process Uralmetal industry had produced only a surplus, ignoringthe needs of laborers and technological improvements.Dependency of surplus on economic interests of dominantfeudal social structure played more decisive role thanembryonic capitalist social structure. Even industrialprogress and hiring of labor mainly fulfilled the tasks

of reproducing feudal-serf economy during the 18-19centuries, unless the amount of feudal surplus exceedsthe one of capitalist surplus.  

Iron production at Ural region of Russia during theXVIII-XIX centuries(in million tons)

year 

production year production

1710 1,6 1810 124,5

1720 4,9 1820 126,1

1730 9,8 1830 157,3

1740 16,4 1840 160,5

1750 22,9 1850 176,9

1760 45,9 1860 237,5

1770 65,5 1870 242,4

1780 90,1 1880 317,8

1790 101,6 1890 453,7

1800 129,4 1900 822,3

 

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