Economy of Austria-Hungary
The dynamic Pest grew into Hungary's administrative, political, economic, trade and cultural hub.
Austria-Hungary was a large, heavily rural country with wealth and income levels comparable to France or the USA in 1870.
The textile industry was the main factor, utilizing mechanization, steam engines, and the factory system.
Key factors included the replacement of charcoal by coal, introduction of steam engine, and the rolling regard.
[clarification needed] The first steam engines of continental Europe was built in Újbánya – Köngisberg, Kingdom of Hungary (Today Nová Baňa Slovakia) in 1722.
[9] However, in a comparison with Germany and Britain: the Austro-Hungarian economy as a whole still lagged considerably, as sustained modernization had begun much later.
[10] The population growth rate was slower than in most European countries, which was exacerbated by the massive emigration to the USA.
Foreign investment in the Empire, 1870 to 1913, was dominated by Germany, followed by France, and to a lesser extent Great Britain.
In the later years of the 19th century, rapid economic growth spread to the central Hungarian plain and to the Carpathian lands.
The Empire built up the fourth-largest machine building industry of the world, after the United States, Germany, and Great Britain.
[13][14] The strong agriculture and food industry of Hungary with its center at Budapest became predominant within the Empire and made up a large proportion of the export to the rest of Europe.
In the Galician north, the Kingdom of Galicia and Lodomeria, an ethnic Pole-administered autonomous unit under the Austrian crown, became the major oil-producing region of Europe.
[17][18][19][20] From 1527 (the creation of the monarchic personal union) to 1851, the Kingdom of Hungary maintained its own customs controls, which separated it from the other parts of the Habsburg-ruled territories.
The agreements were renewed and signed by Vienna and Budapest at the end of every decade because both countries hoped to derive mutual economic benefit from the customs union.
[citation needed][24][25][26] The Hungarian factories producing rolling stock as well as bridges and other iron structures were the MÁVAG company in Budapest (steam engines and wagons) and the Ganz company in Budapest (steam engines, wagons, the production of electric locomotives and electric trams started from 1894).
The system provided a local demand for iron and steel, coal, rolling stock, terminals, yards, construction projects, skilled workers and manual labor.
[28] Although of lighter weight and not as well-managed as the German lines, the Austro-Hungarian system played a major role in supporting the Army in the First World War.
Automotive factories in the Kingdom of Hungary manufactured motorcycles, cars, taxicabs, trucks and buses.
[citation needed] In 1884, Károly Zipernowsky, Ottó Bláthy and Miksa Déri (ZBD), three engineers associated with the Ganz Works of Budapest, determined that open-core devices were impractical, as they were incapable of reliably regulating voltage.
[44] Bláthy had suggested the use of closed cores, Zipernowsky had suggested the use of parallel shunt connections, and Déri had performed the experiments;[45] The first Hungarian water turbine was designed by the engineers of the Ganz Works in 1866, the mass production with dynamo generators started in 1883.
[60] The first airplane in Austria was Edvard Rusjan's design, the Eda I, which had its maiden flight in the vicinity of Gorizia on 25 November 1909.
The largest shipyard in the dual monarchy and a strategic asset for the Austro-Hungarian Navy was the Stabilimento Tecnico Triestino in Trieste, founded in 1857 by Wilhelm Strudthoff.
Smaller shipyards included the Cantiere Navale Triestino in Monfalcone (established in 1908 with ship repairs as the main activity, but went on during the war to manufacture submarines) and the Whitehead & Co. in Fiume.
The latter was established in 1854 under the name Stabilimento Tecnico Fiume with Robert Whitehead as the enterprise's director and the purpose to produce his torpedoes for the Navy.
