Peasant Economy and Industrialization: The Example of the Sugar Industry in Germany

Abstract

This article examines the relationship between peasant farming and industrialization through the example of the beet sugar industry in Germany, focusing on the Prussian province of Saxony, Brunswick, and Hanover during the first phase of the Industrial Revolution (ca. 1830-1870). The aim is to analyse the role of peasants as capital providers and beet suppliers in the emerging sugar industry and to draw attention to the direct interlinkage between peasant economy and German industrialization, an aspect that has received little scholarly attention.
The study draws on jubilee publications and founding documents of individual sugar factories, shareholder registers, and data on land ownership of shareholders in Hanover and Brunswick.
The German agrarian reform of the early nineteenth century, which ran parallel to the Industrial Revolution, enabled significant accumulation of peasant capital in these regions through favourable legal conditions - personal freedom, hereditary rent rather than labour dues, and the indivisibility of the farm. In six factories founded between 1852 and 1868, peasants provided approximately 80 per cent of the capital; shareholders combined their investment with sugar beet delivery obligations, giving these enterprises a cooperative but factually capitalist character.
The beet sugar industry exerted a lasting influence on the peasant economy, promoting the intensification of beet cultivation, improvements in soil preparation, the growth of livestock farming through molasses feed, and the introduction of artificial fertilizers. At the same time, in the core beet regions the development led to pronounced social polarization between a rentier peasantry and a growing class of smallholders and landless agricultural labourers, generating heated public debate about the future of the agrarian social order.