2 Comments

1. G. J. Meijer says:
   November 29, 2009 at 5:44 am

   Very interesting theme. Innovation flourishes when there is a societal need. But the competitive advantages disappear with subsequent technological improvements (interesting what this would mean for the 21st century). On the whole, the book is well worked out but it suffers from too many and sometimes too low quality graphs, to say nothing about the seventies style “computer programs”.
   
   The technology of the steam engines etcetera might have obtained some more attention.
   Rating: 3 / 5
2. R. Albin says:
   November 29, 2009 at 8:21 am

   This well written and well argued book is an analysis of why the Industrial Revolution began in Britain. Allen isolates 2 key factors; high labor costs and low energy costs. Compared to most other European countries, Holland excepted, and the rest of the world, Britain had relatively high wages. This provided a considerable incentive for investment in labor saving technologies. Britain was simultaneously well endowed with accessible coal and had developed a strong coal mining sector prior to the onset of the industrial revolution. Cheap energy allowed innovation in labor saving technologies that were crucial to the Industrial Revolution in steam power and iron production. In parallel and interacting was technological innovation in the first truly global industry - cotton textiles. These developments spurred the self-sustaining process of technological improvement and expansion that led to world-wide industrialization. This is essentially a theory of why Britain, among European countries, generated industrialization. Holland was another high wage economy but lacked coal deposits. Essentially all other European nations had lower wage regimes and relatively high energy costs. Allen argues that industrial innovation was seen in France but not in the key industries-technologies that led to the Industrial Revolution. Allen’s arguments, buttressed by quite a bit of analysis of economic data, and even some modeling, are convincing.

   Allen describes other features that were needed for industrialization. These include relatively high rates of literacy and numeracy, a scientific world view, significant agricultural innovation, and favorable political institutions. Largely implicit, and sometime explicit, in Allen’s analysis is an explanation for why industrialization began in Europe as opposed to China or other parts of the world. Briefly, only Western Europe (Britain and Holland, actually) had high wage economies, only Europe had undergone the Scientific Revolution, and only Britain had a substantial coal industry. While not the primary focus of this book, Allen has some interesting analysis of how Western Europe developed the potential for industrialization. This is a highly contingent (path dependent in economic terminology) process with roots in the aftermath of the Black Death. Mercantilism and successful imperial expansion, large volume inter-european and international trade, the latter a produce of mercantilist-imperialist policies, the rationalist-scientific revolution, and unusually high literacy-numeracy rates, the last promoted in part by phenomena like the spread of Protestantism, all helped prepare the ground for industrialization. Allen’s comment about Britain are particularly interesting. He tracks some aspects of the British industrialization all the way back to economic and demographic changes that followed the Black Death. Allen also looks at some of the other proposed explanations for the Industrial Revolution, such as some forms of “institutionalist” model and a libertarian model, and finds them lacking crucial support.

   A good part of the book is a narrative and analysis of the development of crucial technological innovations like steam engines, use of coke for iron production, and textile manufacture. He uses a useful analytical framework of macro-invention followed by continuous improvement. These are case studies to support his thesis and are interesting in their own right. Allen’s discussion of why and how the Industrial Revolution spread outside of Britain is particularly interesting. He argues that the initial technologies were initially only economic in the high wage-cheap energy environment of Britain, and hence not easily transferable to other countries. In the early decades of the 19th century, however, continuous improvement of key technologies eventually made steam engines, iron ore production, etc., inexpensive enough to be economically viable in many nations.

   There is one point where I think Allen may be incorrect. Allen disputes the conclusions of historians like Joel Mokyr and Margaret Jacob that differential dissemination of Newtonian ideas and attitudes was a key factor in British industrialization. Allen believes that the Scientific Revolution was a key precursor of the Industrial Revolution but that this was a pan-European phenomenon that doesn’t explain why Britain led the way. He has an interesting discussion of linkages between industrial innovation and formal science in the 18th century. The key comparison with with the other high wage European nation, Holland. I’m not sure that Allen really rebuts Jacob’s claim that Newtonian-modern scientific attitudes were more widely disseminated in Britain than Holland. If Jacob is correct, then Britain was doubly distinctive among European nations, underscoring the highly contingent sequence of events that led to industrialization.

   The conclusion that the Industrial Revolution resulted from an unusually fortunate conjunction of events has interesting implications. It suggests that the norm for human civilizations is some form of durable Malthusian fluctuations, which is the way quite a few people view Chinese history.
   Rating: 5 / 5