disscuss four economic effects of the industrial revolution
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Seasonal industries are those which employ people for only few months in a year. To save farmers and workers from ...
Episodes of technological revolutions have produced transformations transcending spheres of human existence. The first industrial revolution mechanised production using water and steam power. In the second, the discovery of electrical energy further boosted productivity. The third featured automation of the production process using electronics and information technology; and the fourth has been driven by technological breakthroughs in physical, digital, and biological spheres. Some drivers of 4IR include artificial intelligence, robotics, the Internet of Things (IoT), 3D printing, digital platforms, and blockchain technologies (Schwab 2016).
Nigeria, like every other nation, faces the realities of 4IR. With a population of over 200 million people, Nigeria is challenged with a slowdown in economic growth and high unemployment. GDP growth has been below 2% since the 2016 economic recession. The relative contribution of sectors to Nigeria’s economic performance has also changed over the years. While there has been growing investment in tech start-ups and telecommunications, agriculture and manufacturing have been growing below potential. In 2018, services accounted for 37% of GDP, agriculture 25%, trade 16%, manufacturing and construction 13%, and crude oil and solid minerals 9%. (NBS 2018a). Despite the expansion in some sectors, employment creation has lagged behind the fast-growing labour force. In 2018, the unemployment rate was about 23.1% while 20.2% of the labour force was underemployed. (NBS 2018b).
The level of utilization of 4IR technologies is not currently widespread in Nigeria. But there could be potential applications to various sectors of the economy, causing disruptions in industries across the country. (Lou et al. 2019). IoT and drone technologies are expected to be central to the future of agriculture. 3D printing is transforming manufacturing. Automation of jobs due to artificial intelligence and robotics will also cause tectonic transformations in the Nigerian labour market. Blockchains are increasingly finding applications in the financial markets and even international trade. Digital platforms are also transforming both trade and transportation industries as well as other markets.
While the technological revolution is poised to affect markets and segments of the Nigerian economy, it might not radically distort market mechanisms. Market mechanisms refer to the forces of demand and supply, the “invisible hands” regulating a free market economy. Contrary to the misconception that capitalism (accompanying the first industrial revolution) ushered market mechanisms, markets and market mechanisms existed long before (3rd century BC), did not arise with the first industrial revolution, and will not disappear in the evolving “post-industrial” economy (Lipsey 1994, 331). The impact of the fourth industrial revolution does not change the coordinating function of market mechanisms. However, like any other shock, technological changes introduce uncertainties and externalities, necessitating government intervention to correct these market excesses.