Robert Allen: Why the Industrial Revolution Was in Britain(paul.kedrosky.com)
paul.kedrosky.com
Robert Allen: Why the Industrial Revolution Was in Britain
http://paul.kedrosky.com/archives/2009/10/robert_allen_on.html
16 comments
The topic "Why the industrial revolution was in Britain" it's one of the firsts ones in the History class that I took at university. The short answer it's "because the glorius revolution": http://en.wikipedia.org/wiki/Glorius_revolution
Sorry, I don't think that's sufficient. While it's sure that the political and hence scientific environment in britain was much better than continental europe, the above video makes it clear to me that the primary factors were the high cost of labour and the low cost of energy.
Good link, but you should know he mentions that aspect and disputes its sufficiency: something more is needed because recent research shows that other nations had respect for property rights, good government and so on.
I see no video on the link, but I was intrigued and found this post by Robert Allen on the same subject:
http://www.voxeu.org/index.php?q=node/3570
I didn't see the video at first, either, but when I hit refresh, it decided to show up.
I've spent a lot of time studying this question. The high bit is that it would have been surprising if it hadn't been. Britain was already the most advanced country in the world by all the usual measures, like literacy, per capita income, etc.
The question of why it didn't happen in the Netherlands is interesting. At one point I thought it was because the Netherlands lacked natural resources like coal and rivers. But it turns out they were already out of contention by the time the Industrial Revolution started. The Netherlands were prosperous in 1650 but a wreck by 1750. The main reason seems to have been high taxes, driven by the (ultimately impossible) goal of maintaining military parity with England and France, which had much larger populations.
The question of why it didn't happen in the Netherlands is interesting. At one point I thought it was because the Netherlands lacked natural resources like coal and rivers. But it turns out they were already out of contention by the time the Industrial Revolution started. The Netherlands were prosperous in 1650 but a wreck by 1750. The main reason seems to have been high taxes, driven by the (ultimately impossible) goal of maintaining military parity with England and France, which had much larger populations.
I have to agree with the latest theory that Britain had the unique combination of expensive labour and cheap energy.
It was unique to Britain for reasons having to do with coal and trade with the colonies, but the bottom line is only when you have cheap energy and expensive labour does it make sense to invest in machinery.
Only under those circumstances is it economical.
Even today companies in China who have tried to use more advanced machines to replace workers have found out it is less profitable. There is nothing magic about machines, they have to be more profitable then the alternative. And when labour is cheaper, you just use human labour, what ever is cheapest and works.
For those who prefer to read: http://www.voxeu.org/index.php?q=node/3570
It was unique to Britain for reasons having to do with coal and trade with the colonies, but the bottom line is only when you have cheap energy and expensive labour does it make sense to invest in machinery.
Only under those circumstances is it economical.
Even today companies in China who have tried to use more advanced machines to replace workers have found out it is less profitable. There is nothing magic about machines, they have to be more profitable then the alternative. And when labour is cheaper, you just use human labour, what ever is cheapest and works.
For those who prefer to read: http://www.voxeu.org/index.php?q=node/3570
Even if that were a necessary condition, it wouldn't be sufficient. You also have to have an economy where investment in machinery makes sense. (I.e. your investment won't be confiscated by corrupt officials or destroyed by invaders.)
Also, humans only compete with machines in a few types of work. For example, you could not use human power to drive most of the things we drive with engines: cars, trains, ships, planes, etc.
Also, humans only compete with machines in a few types of work. For example, you could not use human power to drive most of the things we drive with engines: cars, trains, ships, planes, etc.
> For example, you could not use human power to drive most of the things we drive with engines: cars, trains, ships, planes, etc.
True, but not relevant to the initial, successful commercialisation of the technology. The mobile power plants are a whole step beyond the "lets mechanize labour".
Newcomen engine: 1712, Stephenson's Rocket 1829.
True, but not relevant to the initial, successful commercialisation of the technology. The mobile power plants are a whole step beyond the "lets mechanize labour".
Newcomen engine: 1712, Stephenson's Rocket 1829.
That would be Hernando de Soto's ideas about developing capitalism in the western world as higher order property rights: i.e. a system where you are guaranteed the right both to use what you own and to perform other operations with it: selling to a complete stranger, renting, using it as collateral etc. I still haven't read any explanation as to why it happened in the western Europe but not elsewhere.
This thought struck me when I observed the reverse process in some poor countries during the oil boom. Where people are poor and energy is expensive, there's an incentive to 'deindustrialize' by replacing expensive machines with cheap labour. Industries weren't just standing still or going bust, but innovating by eliminating mechanization and taking on workers. Presumably an industrial revolution is the same process in reverse.
In addition to military costs, the Dutch were hurt financially by trying to keep up with Britain and France's colonial expansion in the new world, which they ultimately couldn't do either.
Case in point: New York was founded as New Amsterdam before the Brits took over. Wall Street is named such because it's where the original Dutch wall stood.
Case in point: New York was founded as New Amsterdam before the Brits took over. Wall Street is named such because it's where the original Dutch wall stood.
An armchair analysis may also suggest that the more risk-taking, energetic individuals may have been selected for in the British population. These are the folks that made the jump across the channel seeking opportunity and probably brought with them that individualistic/entreprenuerial ethos.
Awesome quote at about 62 minutes: "...This is all getting boring right? The point of this is: invention is boring. Invention is not a great intellectual breakthrough. Invention is not exciting reconceptualization. It's doing all of these hard little things."
A bit sobering for us folks who think Haskell/Clojure/Insert-high-level-language-here is going to change the world. Not that these tools aren't valuable, as they increase productivity (which is kind of a big deal when good engineers cost $100k a year), but on the flip side, it was then as true then as it is true now that you just had to do the grunt work of experimenting with your product.
A bit sobering for us folks who think Haskell/Clojure/Insert-high-level-language-here is going to change the world. Not that these tools aren't valuable, as they increase productivity (which is kind of a big deal when good engineers cost $100k a year), but on the flip side, it was then as true then as it is true now that you just had to do the grunt work of experimenting with your product.
Although on the other hand you have to factor in the "General Purpose Technology", even within IT - some things are generally applicable and cause a great leap forward - things like Lotus 1-2-3, GUI/mouse, RDBMS, html/web, etc. (using older examples as the older a technological leap forward is, the more unambiguously you can identify it clearly as being a step change rather than an iterative improvement or of limited applicability). Of course in the same way all these are followed up by thousands of small iterative improvements and boring stuff to slowly creep utility forward while waiting for the next big leap.
I can't see the video, but I'm somewhat skeptical of the claim implied in the title: people have been arguing about the Industrial Revolution's causes practically since the Industrial Revolution. My favorite recent book on the subject is A Farewell to Alms (see http://jseliger.com/2007/09/10/a-farewell-to-alms ), but there are countless others.