Most of these people were engaged in manufacturing industries, and their products were shipped across Europe and, sometimes, around the world.
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Artisans in Witney, Oxfordshire, for instance, sold blankets to the Hudson Bay Company, which swapped them for fur with the natives of Canada. The economy of the Low Countries developed along similar lines. The Netherlands were even more urbanized than England and also had large, exportoriented rural industries.
Spain was particularly unlucky.
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In the 16th century, it looked like the most successful imperialist, for Latin America yielded so much silver. As a result, Spanish agriculture and manufacturing became uncompetitive. The constancy in the share of the urban population in Spain masks great changes — the populations of old industrial cities collapsed while Madrid expanded on the basis of American loot.
Globalization spurred northwestern Europe forward but held southern Europe back. Global Economic History Success in the global economy had major implications for economic development, including: First, the growth in urbanization and rural manufacturing increased the demand for labour and led to tight labour markets and high wages. Living standards were high in London and Amsterdam Figure 3. Second, growing cities and a high-wage economy put great demands on agriculture for food and labour.
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The result was agricultural revolutions in both England and the Netherlands. Third, growing urban demand also led to energy revolutions in both England and the Netherlands. As the cities grew, wood prices skyrocketed, and substitute fuels were developed. In the Netherlands, the alternative was peat; in England, it was coal. Coal was mined in Durham and Northumberland and shipped down the coast to London. England was the only country in the world with a large coal-mining industry in the 18th century, and that also gave it access to the cheapest energy in the world, as Figure 6 indicates.
Adult literacy, and Percentage of the adult population that could sign its name Global Economic History Fourth, the high-wage economy generated a high level of literacy, numeracy, and skill formation in general. Literacy rose everywhere in Europe, but the growth was greatest in northwestern Europe. The Reformation does not explain the rise, as is often assumed, for literacy was as high in northeastern France, Belgium, and the Rhine Valley — all Catholic areas — as in the Netherlands or England. The rise in literacy was due to the high-wage, commercial economy. The expansion of commerce and manufacturing increased the demand for education by making it economically valuable; at the same time, the high-wage economy provided parents with the money to pay for schooling their children.
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The Revolution was not the abrupt discontinuity that its name suggests but was the result of the transformations of the early modern economy discussed in the last chapter. The rate of economic growth achieved in the century after 1. Moreover, the great achievement of the British Industrial Revolution was that it led to continuous growth, so that income compounded to the mass prosperity of today. Technological change was the motor of the Industrial Revolution. In addition, there were a host of simpler machines that raised labour productivity in unglamorous industries like hats, pins, and nails.
There was also a range of new English products, many of which, like Wedgwood porcelain, were inspired by Asian manufactures.
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The steam engine was applied to transportation with the invention of the railway and the steamship. Power-driven machinery, whose use was initially restricted to textile mills, was applied to industry generally. The question is: why was the revolutionary technology invented in England rather than the Netherlands or France or, for that matter, China or India? Cultural and political context Global Economic History The Industrial Revolution took place in a particular political and cultural context that was favourable to innovation, and that may help to explain it.
The English constitution has been a model for European liberals and modern economists alike.
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Much power remained with the Crown — in particular, the power to make war and peace. While Parliament had a constitutional right to refuse funds for war, it never did. The English constitution had many features that promoted economic growth, although they were not the ones stressed by modern economists, who emphasize restrictions on taxation and the security of property.
Parliamentary supremacy actually resulted in the reverse. The nobility in France were exempt from taxation, but the English Parliament introduced a land tax in that was imposed on peers as well as commoners. Most tax revenue, however, was raised from excise duties on consumer goods like beer and imports like sugar and tobacco. These taxes were borne primarily by 28 workers, who were not represented in Parliament. Parliament may have checked the Crown, but, in the absence of democracy, who checked Parliament?
This was not possible in France. In addition, the success of natural philosophy lent 29 The Industrial Revolution In the event, the English state collected about twice as much per person as the French state and spent a larger fraction of the national income. It is arguable that these expenditures promoted economic growth. Most of the money was spent on the army and the navy. The former was occasionally directed abroad but was always available to maintain domestic order by suppressing assemblies opposed to machinery or in favour of democracy. Even the workers gained from this since imperialism was the basis of the high-wage economy, which in turn led to growth by inducing labour-saving technical change.
Had Louis XIV had the power to levy taxes, he might have advanced French prosperity by maintaining the French navy in a permanent state of readiness rather than enlarging or contracting it in response to the swing between war and peace. How much popular culture shared in this reorientation is an open question. There are important examples of working-class inventors adopting the Newtonian model. Did this early interest in Newton dispose Harrison to invent the chronometer? On the other hand, there was continued popular enthusiasm for witchcraft, which was the medieval alternative to science.
The most powerful changes were urbanization and the growth of commerce. They encouraged the spread of literacy and numeracy by increasing their value. By the 18th century, most sons of craftsmen, artisans, shop keepers, and farmers, and a smaller share of the sons of labourers, received several years of primary education. Many girls were also schooled. The result was a public that read newspapers and followed politics to an unprecedented degree.
It was a new world when a radical like Tom Paine could achieve celebrity by selling hundreds of thousands of copies of The Rights of Man. These cultural developments, therefore, cannot explain why the Industrial 30 Revolution was British. More to the point, so far as technology is concerned, British wages were high relative to the price of capital Figure 7.
In the late s, the wage rate relative to the price of capital services was similar in southern England, France, and Austria, which are representative of continental Europe. The incentive to mechanize production was correspondingly less in India. It was the same story with energy. Consequently, energy was much cheaper compared to labour in Britain than it was anywhere else.
With more capital and energy at their disposal, British workers became more productive — the secret of economic growth. In Asia and Africa, the cheapness of labour led to the opposite result. The growth of cotton led to the explosive growth of Manchester and many smaller cities in the north of England and Scotland. Cotton was also produced in small centres across Asia and Africa.
The various East Indies companies began to ship cotton calicoes and muslins to Europe in the late 17th century where they successfully competed against linen and wool, the principal European textiles. Cotton was so successful that France prohibited its import in , and the English restricted its domestic consumption. However, there was a large export market in West Africa, where cotton cloth was 32 bartered for slaves.
In this market, English cloth competed against Indian cloth. None involved great conceptual leaps; instead, they required years of experimental engineering to come up with designs that worked reliably. The key is that the machines they invented increased the use of capital to save labour. That is why the Industrial Revolution was British. Cotton yarn was manufactured in three stages. First, the bales of raw cotton were broken open and the dirt and debris removed. Wages were so high in England that competition with India was only possible in the coarsest fabrics. The stakes were considerable: in , Bengal spun about 85 million pounds of cotton per year, while Britain managed only 3 million.
There were numerous attempts to mechanize production.