Poverty in Galicia was extreme, particularly in the late 19th century. Galicia in that period has been described as not only the poorest province of Austro-Hungary, but the poorest province of Europe. The reasons included little interest in reform from the major landholders and the Austrian government, population growth resulting in small peasant plots, lack of education, primitive agricultural techniques, and a vicious circle of chronic malnutrition; famine; and disease, reducing productivity. Poverty in the province was so widespread that the term "Galician misery" or "Galician poverty" (bieda galicyjska) has become proverbial.
Austria-Hungary failed to create transportation networks necessary for the development of industries and markets throughout the empire. Unlike imperial Germany, the Habsburgs were hostile toward the idea of building railway systems in the provinces, and remained fixated on their own metropolis. The whole of Austrian Bohemia was served by only one line throughout the 1860s. Emperor Francis opposed further construction "lest revolution might come into the country." Railways were owned privately in Austria-Hungary before 1881, and only gradually acquired by the state interest until the outbreak of World War One. Viennese banks – wrote Clive Trebilcock of Cambridge – were tapping the eastern grain-plains [of Galicia] in fully colonial style.
A number of social factors caused the extreme poverty in Galicia. In the 19th century, most of Galicia was part of the Austrian Empire (later, the Austro-Hungarian Empire), which acquired it through the partitions of Poland, and was its poorest province. Whereas on average, 7.3% of the Empire were eligible to pay the minimum income, in Galicia, where the per capita income was one tenth of the Austrian average, only 0.8% were wealthy enough to qualify for taxation. Due to malnutrition and illnesses, the province was said to have "the highest number of people not fit for military duty".