Proto-industrialization

Proto-industrialization is the regional development, alongside commercial agriculture, of rural handicraft production for external markets.
The term was introduced in the early 1970s by economic historians who argued that such developments in parts of Europe between the 16th and 19th centuries created the social and economic conditions that led to the Industrial Revolution. Later researchers suggested that similar conditions had arisen in other parts of the world.
Proto-industrialization is also a term for a specific theory about proto-industries' role in the emergence of the Industrial Revolution. Aspects of the proto-industrialization theory have been challenged by other historians. Critics of the idea of proto-industrialization are not necessarily critics of the idea of proto-industries having existed prominently or having played a role as social and economic factors.
Criticism of the theory has taken various forms -- that proto-industries were important and widespread but not the main factor transitioning to industrial capitalism, that proto-industries were not distinct enough from other types of pre-industrial manufacturing or agrarian handicrafts to formulate a wider phenomenon, or that proto-industrialisation is actually industrialisation.
Other scholars have built and extended upon proto-industrialisation, or recapitulated its points -- about proto-industry's role in the development of early modern economic and social system of Europe and the Industrial Revolution. Outside of Europe, major examples of economic phenomena classified as proto-industrialisation by historians were in Bengal Subah and Song China.
History.
The term was coined by Franklin Mendels in his 1969 doctoral dissertation on the rural linen industry in 18th-century Flanders and popularized in his 1972 article based on that work.
Mendels argued that using surplus labor, initially available during slow periods of the agricultural seasons, increased rural incomes, broke the monopolies of urban guild system and weakened rural traditions that had limited population growth.
The resulting increase in population led to further growth in production, in a self-sustaining process that, Mendels claimed, created the labour, capital and entrepreneurial skill that led to industrialization.
Other historians expanded on these ideas in the 1970s and 1980s.
In their 1979 book, Peter Kriedte, Hans Medick and Jürgen Schlumbohm expanded the theory into a broad account of the transformation of European society from feudalism to industrial capitalism.
They viewed proto-industrialization as part of the second phase in this transformation, following the weakening of the manorial system in the High Middle Ages.
Later historians identified similar situations in other parts of the world, including India, China, Japan and the former Muslim world.
The applicability of proto-industrialization in Europe has since been challenged. Martin Daunton, for example, argues that proto-industrialisation "excludes too much" to fully explain the expansion of industry: not only do proponents of proto-industrialisation ignore the vital town-based industries in pre-industrial economies, but also ignores "rural and urban industry based upon non-domestic organisation"; referring to how mines, mills, forges and furnaces fit into the agrarian economy. Clarkson has criticized the tendency to categorize all types of pre-industrial manufacturing as proto-industries. Sheilagh Ogilvie discussed the historiography of proto-industrialisation, and observed that scholars have re-evaluated pre-factory industrial production, but have seen it emerge as a phenomenon of its own rather than just a precursor to industrialisation. According to Ogilvie, a major perspective "emphasizes long-term continuities in the economic and social development of Europe between the medieval period and the nineteenth century." Some scholars have defended the original conceptualisation of proto-industrialisation or extended it.
Indian subcontinent.
Some historians have identified proto-industrialization in the early modern Indian subcontinent, mainly in its wealthiest and largest subdivision, the Mughal Bengal
(today's modern Bangladesh and West Bengal), a major trading nation in the world which had been in commercial contact with global markets since the 14th century. The Mughal region singly accounted for 40% of Dutch imports outside Europe. Bengal was the wealthiest region in the Indian subcontinent, and its proto-industrial economy showed signs of driving an Industrial revolution. During the 17th–18th centuries, under the auspices of Shaista Khan, the comparatively liberal uncle of Mughal Emperor Aurangzeb as the Subehdar of Bengal, sustained growth was being experienced in manufacturing industries, exceeding China. According to one theory, the growth can be explained by sharia and Islamic economics imposed by Aurangzeb. India became the world's largest economy, valued 25% of world GDP, having better conditions than 18th-century Western Europe, prior to the Industrial Revolution.
The Kingdom of Mysore, a major economic and military power in South India, ruled by Hyder Ali and Tipu Sultan, allies of Emperor of the French Napoleon Bonaparte, also experienced massive growth in per capita income and population, structural change in the economy, and increased pace of technological innovation, most notably military technology.
Song China.
Economic development in the Song Dynasty has often been compared to proto-industrialization or an early capitalism. Many of the economic gains were lost during the Yuan dynasty due to the conquest by the Mongol Empire.
The commercial expansion began in the Northern Song and was catalysed by migrations in the Southern Song. With the growth of the production of non-agricultural goods in a cottage industry context (such as silk), and the production of cash crops that were sold instead of consumed (such as tea), market forces were extended into the life of ordinary people. There was a rise of industrial and commercial sectors, and profit-making comercialisation emerged. There were parallel government and private enterprises in iron and steel production, while there was strict government control of some industries such as sulfur and saltpetre production. Historian Robert Hartwell estimated that per capita iron output in Song China rose sixfold between 806 and 1078 based on Song-era receipts.
An arrangement of allowing competitive industry to flourish in some regions while setting up its opposite of strict government-regulated and monopolized production and trade in others was prominent in iron manufacturing as in other sectors. In the beginning of the Song, the government supported competitive silk mills and brocade workshops in the eastern provinces and in the capital city of Kaifeng. However, at the same time the government established strict legal prohibition on the merchant trade of privately produced silk in Sichuan province. This prohibition dealt an economic blow to Sichuan that caused a small rebellion (which was subdued), yet Song Sichuan was well known for its independent industries producing timber and cultivated oranges.
Europe.
Mendels' initial coining of "proto-industrialisation" referred to commercial activities in 18th-century Flanders and much study focused on the region. Sheilagh Ogilvie wrote, "Proto-industries arose in almost every part of Europe in the two or three centuries before industrialization."
Rural proto-industries were often affected by guilds. They retained major influence over rural manufacturing in Switzerland (until the early 17th century), France and Westphalia (until the later 17th century), Bohemia and Saxony (until the early 18th century), Austria, Catalonia, and the Rhine area (until the later 18th century) and Sweden and Württemburg (into the 19th century). In other areas of Europe, guilds excluded all forms of proto-industry, including in Castile and parts of northern Italy. Political struggles occurred between proto-industries and regional guilds that sought to control them, as well against urban privileges or customs privileges.
Bas van Basel argued that some non-agriculture activities in the Low Countries reached a proto-industrial extent as early as the 13th century, though with regional and temporal differences, with a peak in the 16th century. Van Basel observes that Flanders and Holland developed as urbanised regions (a third of Flanders' population being urban in the 15th century, and over half of Holland's population in the 16th century) with a commercialised countryside and developed export markets. Flanders saw the predominance of labor-intensive rural activities such as textile production, while Holland saw the predominance of capital-intensive urban activities such as ship-building. Proto-industrial activities in Holland included "glue-production, lime-burning, brick work, peat digging, barging, shipbuilding, and textile industries" targeted for export. 
Historian Julie Marfany also put forward a theory of proto-industrialisation observing proto-industrial textile production in Igualada, Catalonia from 1680, and its demographic effects -- including increased population growth that compared to the later industrial revolution. Marfany also suggests that a somewhat alternate mode of capitalism developed due to differences in the family unit compared to Northern Europe.