The author never provides evidence either for or against the claim about capital punishment being necessary for labour discipline in British capitalism. Arguing against critics is not the same as supporting the claim they criticize.

The author never contradicts the claim about capital punishment being necessary for labour discipline in British capitalism. Specifically, a distinction between industrialization and capitalism does’t contradict that claim.

The author never attempts to prove the claim about capital punishment being necessary for labour discipline in British capitalism. The point is to argue against the critics, not to prove the original claim.

The author’s whole goal is to refute the critics. Nothing in the argument supports the critics, and the distinction between industrialization and capitalism specifically rebuts them.

This is a good description of the role played by the distinction between industrialization and capitalism. The author uses the distinction to show that the critics missed the point of the claim they criticize, thus undermining them.