Economy before 1914

Russia was a poor country. She had great resources but these were 'locked in’ by the vast size of the country and the extreme climate. She had produced cheap raw materials for other manufacturing countries and a growing surplus of grain, but it was the policy of the Tsars from 1855 to compete as a manufacturing power.

• In 1914 85 per cent of the population were still peasants.
• Peasants had to practise subsistence farming.
• Economically, the vast majority of the population contributed very little to Russian society.
• Under a succession of Tsarist ministers (Bunge, Witte and Stolypin) railways were built, foreign investment attracted and landholdings reformed.
• Economic growth rates averaged 9 per cent from 1894–1900 and 5 per cent from 1900–1914. These were huge rates of change.
• Industrial growth was centred on armaments because Tsar Nicholas II wanted to protect Russia’s position as a great power. However, oil, textiles, minerals and iron and steel were the industries most affected by economic growth.

Subsistence farming means that they produced what they needed, took little to market, did not use much money and could not easily be taxed.

By 1914 the Russian economy had grown more slowly than those of Germany, the USA, France and Britain. However, Russia put a huge army of 3 million troops on to the front against Germany and Austria. This meant that Russia was unable to equip her troops as well as her enemies. The strain of supplying them would be immense.