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Relative deprivation and labour conflict during Spain’s industrialization: the Bilbao estuary, 1914–1936

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Abstract

What drove social conflict in Spain’s industrial areas in the period before the Spanish Civil War? This paper is concerned with contrasting the determinants of working-class conflict in northern Spain at the beginning of the twentieth century. Our hypothesis is that the key determinant of conflicts in emerging industrial areas during the interwar period was the struggle to obtain satisfactory family income in a context of combined high price fluctuation, unemployment and economic boom and bust. We suggest two new ways to decipher how economic factors interact with labour conflict. We introduce the family as the relevant income unit when considering wage struggles and relative deprivation. And secondly, we study the reactions to short-term variations of income on families by using monthly rather than quarterly or annual data.

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Notes

  1. Kuznets (1976: 1) already insisted on using families as basic units of income measurement when addressing distribution. More recently, the standard of living debate has focussed on family income Humphries (1977), Horrell and Humphries (1992), Allen (2001, 2009, 2013), Humphries (2010). Rothbart (1989) insists that ‘the wage struggle (…) cannot be understood simply as a struggle over the level of pay for the performance of work, since a major justification for higher wages has been the argument that the wage of adult males should be determined by the subsistence needs of a family’.

  2. We define relative deprivation as the judgment that one is worse off compared to other groups and/or compared to the past. This judgment may lead to frustration and collective action. Townsend (1974: 15) argued that ‘individuals, families and groups in the population can be said to be in poverty when they lack the resources to obtain the types of diets, participate in the activities and have the living conditions and amenities which are customary, or are at least widely encouraged or approved, in the societies to which they belong’. Therefore, poverty is the guiding concept, and we would define ‘relative deprivation’ as the perception of poverty. At the same time, collective action and/or social conflict would be a reaction to relative deprivation. For the recent evolution of deprivation research, see Gordon (2006).

  3. Ritschl et al. (2008). As Morys and Ivanov (2011: 6) have summarized, historical National Accounts are normally constructed with an eye for the level rather than the volatility; this (understandable) preference determines interpolation techniques which can lead to serious differences in volatility between the reconstruction and the true unknown series. Fortunately the disaggregate series which maintain the original volatility are often abundant for historical periods.

  4. For a summary of European labour relations during the First World War and the 1920s, see Greary (1981: 134–143).

  5. For a summary of strike theories, see Friedman (2009).

  6. However, there are studies which contradict a pro-cyclical pattern of strike incidence. For example, Ingram et al. (1993) for the British manufacturing sector in the 1980s; or more recently Devereux and Hart (2011) for the British engineering sector between 1920 and 1970.

  7. Apart from Franzosi, for an additional summary of strike theories see Friedman (2009).

  8. For the history of Basque industrialization, see Harrison (1983), Escudero (1998) and González Portilla (2001). For a general account on Spanish industrialization during the interwar period, see Houpt and Rojo Cagigal (2013).

  9. Population in the Bilbao estuary has been thoroughly examined by a group of demographers lead by González Portilla (2001): 117, 130, 278–9, 396 and 403. Based on municipal statistics, only 9.4 % of married women worked in 1900 and by 1935 this had decreased to 3.7 % (García Abad and Ruzafa Ortega 2009: 304). For a summary on how the male breadwinner nuclear family evolved see Rojo Cagigal and Houpt (2011: 11).

  10. The index is based on seventeen basic consumption goods’ price series and calculates a gradually changing consumption basket reflecting variations in consumption patterns during the 1914–1936 period with a gradual diet shift in food groups towards fresher products. A typical working-class family of five members constitutes the consumption and production unit of analysis. For a detailed description of the index calculation see Rojo Cagigal and Houpt (2011). For living standards in Biscay, see Pérez Castroviejo (1992); an up-to-date account of the debate about the evolution of living standards in Spain and France can be found in Chastagnaret et al. (2010).

  11. Monthly data was extracted from Altos Hornos de Vizcaya (1914–1923). Annual averages have been taken from González Portilla (1984): 74 and 85). This company was created by merger of two of the leading iron and steel company with a smaller tinplate factory in 1901. They employed 5,905 workers in 1916 and 8,300 in 1930, approximately one third of the workers employed in the iron and steel industry.

  12. ‘If marriage and trade-union unemployment corresponded closely in timing and, in some senses, in amplitude of variation, it is tempting to treat both as proxies for the unemployment,’ Southall and Gilbert (1996: 55).

  13. Friedlander found that from 1855 to 1901 unemployment and marriage rates were negatively correlated in England and Wales. During the entire period, for each unemployment peak in a given year there was a trough in the marriage rate and vice versa. His regression analysis confirmed that the change in unemployment levels explained nearly 50 % of the variance in marriage rates (Friedlander 1992: 32–33). Kirk also found an inverse correlation between unemployment and nuptiality for the United States, stronger during the interwar period that after the Second World War (Kirk 1960).

  14. The renewed worsening in 1936 is not shown on the graph.

  15. Dasgupta and Ray (1987), and Ray (1998), especially chapter 8 on poverty and nutrition and Sect. 13.4 on poverty, nutrition and labour markets. On energy requirements and work energy, see also Consolazio et al. (1961), FAO (2001), Harris (2004), and Floud et al. (2011).

  16. Short waves of strikes are possibly related to small downward adjustments in ‘real family incomes’ during the late 1930s.

  17. Consolazio (1966), Schofield (1974), Guzman et al. (1984), and Payne and Lipton (1994).

  18. Guaranteeing the share of male breadwinners may have been a rational response, enabling the husband and father to remain in work and thus contribute to the well-being of the family as a whole. However, this meant that any shortfall would be imposed exclusively on the share of women and children. Humphries (2013).

  19. See Rojo Cagigal and Houpt (2011) for mortality, pawning and child-abandoning response to real income variations in the Bilbao estuary over this period.

  20. The Confederación Nacional del Trabajo (CNT), an anarchist and radical union founded in 1910, did not achieve a relevant position in Biscay, despite its dominance in other industrial regions such as Barcelona.

  21. Ashenfelter and Pencavel (1969) find a strong causal relation between growing trade union membership and changes in price levels as a measure of changes in real workers’ income. More recently Geraghty and Wiseman (2011) have found a high correlation between both union density and inflation rates with compromise outcomes.

  22. Card and Olson (1995) find higher bargaining power for workers when organized by unions.

  23. For a review on the seasonality of strikes Kennan (1987: 1130); Griffin (1939: 51–54) focuses more on the US and Knowles (1952: 157–160) on Great Britain. Knowles finds the same May seasonality for the United States and Great Britain for the 1919–1939 period, specifically in the metal, engineering, shipbuilding sector but also in transport and construction. The May shift may very well be related to the First of May celebrations increasing conflictivity.

  24. For a summary of countries which had collected strike data by the 1980s, see Paldam and Pedersen (1984).

  25. More recently Huberman and Young (2002), Geraghty and Wiseman (2008, 2011) have examined war of attrition and strike outcomes in Canada in the interwar period, war of attrition with asymmetric information in the 1880s US and the determinants of strike compromises in the US up to 1945 respectively.

  26. See Kaufman (1982) for an exposition on the debate over economic versus organizational-political models. For an institutional approach to the theory of trade unions, see Kaufman (2010).

  27. Rivera (1985) analyzed the labour movement in the city of Vitoria, Luengo (1990) in Guipúzcoa; and Castells (1993) put together a synthesis for all of the Basque regions of Spain. Sanfeliciano López (1990) studied the socialist trade union Unión General de Trabajadores (UGT) in Biscay during the Second Republic; and Mees (1992) analysed the Basque-nationalist labour movement. Other important works include Cabrera and Rey’s (2002) survey on employer’s associations. Miralles Palencia (1992) provides a solid review of most of this literature.

  28. A closer description of the three intense waves of strikes in 1890–1892, 1899–1903 and 1910–1911, with the general disorganization and passivity in between and which precede the period we examine, can be found in Olábarri (1978: 396–404) and Fusi (1975: 81–104, 118–52, 203–21, 230–42 and 318–31).

  29. The cost of a basic food basket which included heating and lodging for working-class families in Bilbao grew from 100 in September 1914 (beginning of WWI) to 168 in November 1918 (end of WWI), and to 224 in December 1920 (price peak during the war and postwar period). See Rojo Cagigal and Houpt (2011).

  30. The liberal political elites rejected compulsory trade unionization because it clashed with basic liberal principles like the freedom of association (Rey Reguillo 1992). See also Adler (2002).

  31. Weak government intervention combined with trade-union pluralism induces Linz (1981: 382) to define this model as a ‘social corporatism with pluralist features’.

  32. Over the 1920s, up to 1929 industrial production increases by little over 60 %, i.e. an annual average growth rate of almost 5%, from 1929 to 1935 it fell by approximately 1.5 % per year (Prados de la Escosura 2003, Tables A.5.7.& A.5.8).

  33. Catholic trade unions (Sindicatos Católicos and Sindicatos Libres) and Basque-nationalist unions such as SOV, also with a strong Catholic background, defended religious and family values, respect for private property, and rejected strike action. These unions strongly favoured negotiations and agreements with employers. SOV was financed by one of the most important entrepreneurs of the time, Ramón de la Sota. See Mees (1992).

  34. For the institutional continuity of the collective-bargaining system in Spain during the 1920s and 1930s see Rojo Cagigal (2009: 97–8).

  35. For discussion and comparisons of the model see Mumford (1993) and Goerke and Madsen (2004).

  36. Quarterly data for United States in Aschenfelter and Johnson (1969), for Great Britain in Pencavel (1970), and for Canada in Abbot (1984). (Kennan 1987: 1122).

  37. In the original model S t ′ is the probability of a strike, which should be approximated by S t /N, the number of observed strikes over the number of contracts that are renegotiated. The probability must be proxied by the total number of strikes registered, which is consistent with assuming contracts being renegotiated evenly throughout the period.

  38. In the original model these seasonal dummies were included to capture the termination of contracts, in our case we include them to capture omitted seasonal variation in general. December shows the lowest strike frequency worldwide and also in Bilbao in this period.

  39. We have applied a 6 month lag to the Bilbao Stock Exchange index based on Moore who calculated an average six month lead for troughs and a 5 month lead for peaks between the United States Common Stock Price index and business cycle in the United States between 1873 and 1945. (Moore 1983: 148).

  40. This is similar to what Skeels (1982) found for the first half of the twentieth century in the US with the exception of the 1920s. See also Kaufman (1982: 484–89).

  41. If the differences in the coefficients estimated by OLS and GLS can give us any hint on the variables omitted from the model, these would be such that they lower the effect of changes in real income and that of unemployment. Higher job security and better working conditions are possible candidates.

  42. For a summary of this sort of ‘defensive strikes’, see Naples (1987).

  43. This has also been pointed out by Rees (1954) and Weintraub (1966); although questioned by Scully (1971), who found differences in the frequencies of both cycles using spectral analysis. Nevertheless it adds the interesting aspect of how inflation and strikes relate to each other.

  44. Goerke and Madsen (2004: 395) summarize the literature which insists on inflation fostering strikes if workers have not been compensated for the resulting loss of purchasing power.

  45. For the corporatization of interest intermediation, see the seminal work of Schmitter (1974). For an analysis of the process of corporatization in authoritarian regimes in interwar Europe, see Pinto (2012).

  46. The coming of the Second Republic also increased union membership in Biscay. Socialist UGT affiliates grew from 18,000 members in 1928 to more than 31,000 in 1934. The second most important union, the Basque-nationalist Solidaridad de Obreros Vascos, increased its membership from 6,200 in 1929 to 18,000 in 1935. Union pluralism re-legalized anarchist and communist unions, prohibited during the dictatorship, although their activity remained limited to very occasional conflicts.

  47. The most important strike motives during 1931 were the re-admittance of laid-off workers and the reduction of the working day.

  48. According to Sanfeliciano López (1990): 301), the underemployment or the unemployment itself was the main obstacle to sustain the workers’ demands via strikes.

  49. Nevertheless as Cruikshank and Kealey (1987) insist wages figure prominently both in times of union strength and weakness.

  50. Publication dates are taken from Prat and Molina (2011: 14). Dummy variable takes value one for the month before publication, the month of publication and the two months following publication.

  51. There are no reliable statistics, and given the difficulty of estimating the impact of reduced hours, this is the magnitude usually assumed by the literature.

  52. Biscay accounted for 2.06 % of the Spanish population and 4.2 % of the unemployment. (Rivera 2002: 128).

  53. For the calculation method of troughs and peaks, see Edwards (1978: 376).

  54. Literature has usually established a direct correlation between poverty and theft. According to the theoretical work developed by Becker (1968), people resort to crime only if the costs of committing the crime are lower than the benefits gained. Therefore, those living in poverty have a much greater chance of committing theft. For the link between economic conditions and crime, see the summary of Johnson (1995: 137–141) for pre-1914 Germany; or the work of Mehlum et al. (2006) for nineteenth century Baviera; and Traxler and Burhop (2010) for Prussia, which show a strong correlation between real wages and crime rates; and Bignon et al. (2011) for nineteenth century France. Bignon et al. (2011) also include references to contemporary studies.

  55. ‘Political violence’ combines series of ‘terrorist attacks’ and ‘subversive actions’, compiled by the local police.

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Acknowledgments

We thank Pamela Radcliff, Christopher Clague and Peter Howlett for help, observations, stimulus and suggestions. Useful comments have been received at presentations held at the WEAI Meeting 2011, San Diego and the Economic History Society Conference 2012, Oxford. Portions of the research were supported by Spanish Ministerio de Educación y Ciencia, projects ECO2009-13331-C01-01, and PR2010-0104. The usual disclaimer applies to the errors that may remain.

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  1. Universidad Carlos III de Madrid, Getafe, Madrid, Spain

    Stefan Oliver Houpt & Juan Carlos Rojo Cagigal

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Correspondence to Stefan Oliver Houpt.

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Houpt, S.O., Rojo Cagigal, J.C. Relative deprivation and labour conflict during Spain’s industrialization: the Bilbao estuary, 1914–1936. Cliometrica 8, 335–369 (2014). https://doi.org/10.1007/s11698-013-0102-6

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