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This article examines how China tackled the technological differences between itself and the West in the process of acquiring steam technology. It begins in the First Opium war (1839-1842), when the Chinese people witnessed British paddle-wheel steam warships. Having misunderstood the steam mechanism, they worked instead with the technology available to them in order to combat British naval forces. In the 1860s, they experimented with steam-powered ship technology again, but in a different environment in which foreign machine tools and knowledge of the steam mechanism were available. Through trial and error they realized the importance both of machine tools in turning the principle of steam power into a workable engine and of technical drawings in diffusing technical knowledge. Thereafter the Chinese government established arsenals and shipyards that used steam as their source of motive power. Along with foreign machine shops, they marked the beginning of radical changes in technology and society in China.