Further suggested reasons by Deyon and Mendels that profits and capital created by proto-industry was one these developments and it was suggested that they would then be re-invested into industrial revolution production. However, evidence suggests that this was just one of many sources of capital, and it should not be singled out for any great importance. Moreover, proto-industry profits and capital often were re-invested into agricultural and land-holding, rather than industrial development.
Another model refers to the Marxists’ view of transition to capitalism. Proto-industrialisation was taken as rural peasants turning to industrial production, such as textiles， straw-plaiting; glass making and creating domestic and international markets where this produce was sold. This is clearly an early capitalist development, with the emergence of industrial production and the commercialisation of trade.
Medick theorized an outline of the stages for proto-industrialization to develop into industrialisation, with the first stage, Kaufsystem, referring to the rural-peasants’ maintenance of control over the production and selling of their output. Entrepreneurs recognised the attractiveness of rural workers, and rural production, as it was uninhibited by; urban guilds and company restrictions which was the way many towns were, whilst many worker’s wages could be lower as some still partly had a subsistence base in agriculture. This led to Verlagsystem, a heightened merchant capital investment, which lead to the peasants’ loss of control and autonomy over production. Merchant capitalists would supply factor inputs, and workers would process them in return for wage, with the merchant capitalists extracting the profits. A third and final stage was the movement of production to centralized and mechanized factories. Medick therefore saw a logical progression, whereby proto-industrialisation would lead to industrialisation, with rural peasants developing a trade and regional domestic and international markets; and merchant capitalists investment leading to their eventual control and industrialisation of the trade, highlighting the value of proto-industrialisation in discussing the British industrial revolution.
However, this Maxist’ view of a transition to capitalism need to be criticized. Rather than industrialize from proto-industry, some proto-industries actually de-industrialised or re-agrarianized, as Coleman concludes that only 4 out of 10 proto-industries were industrialized. De-industrialization refers to the reduction in the industry production, with a return to agriculture. Mendels had suggested that over-supply of labour, driven by population growth, might lead to the preference of using extra labour rather than machinery. This is ironic, as discussed later, as the proto-industrialisation theory views population growth as vital for the development of proto-industry. There is also limited evidence of the transition from Kaufsystem to Verlagsystem, as many small rural peasants, continued to produce on a small scale. Furthermore, Ogilvie and Cerman declare that at no time did a major landless proletarianized workforce dependent on industrial capital arises. Clarkson and Snell also claimed that commercial agriculture developed in many cases earlier than proto-industry, and not always in neighbouring regions. In many proto-industry regions these mechanisms even moved back to agriculture.
Evidence would appear to suggest that proto-industry was not a key aspect of the industrial revolution, but rather reflected the changes in economics and society at the time, namely, growing populations, emerging industries, entrepreneurial activities and the commercialisation of trade. It appears that by no means should proto-industrialisation be isolated as a key in factor in the development of the industrial revolution, in the way that Mendels had outlined, but it should be considered and discussed as one of the many economic changes taking place, that was eventually to lead to the industrial revolution.
