Why the Unemployment Rate Is Not What We Should Be Looking at
What Was the Industrial Revolution?

The Industrialization and Urbanization of England

Greg Clark argues that eighteenth and early nineteenth century England would have urbanized and "industrialized" even in the absence of the revolutions in spinning, weaving, and ironworking.

Clark,

From Greg Clark (2002), "The Secret History of the Industrial Revolution":

England had low transport costs to France and the Netherlands even in the middle ages... wages and output in England will be determined not by the land/labor ratio in England, but by the land/labor ratio in Europe as a whole. The English land/labor ratio will predict real wages and real output only in so far as it moves in sympathy with the European land/labor ratio. Otherwise if England ends with more labor compared to land than other European economies it will not experience a decline in output per worker with a constant technology, but will trade labor intensive products in exchange for land intensive products from elsewhere....

In the years 1300 to 1750 there is a remarkable concordance in the population movements across Western Europe, and English wages, output per head and population [appear to be] linked. But the Industrial Revolution was notable for England’s rapid population growth compared to the rest of Europe, and in particular compared to the Netherlands and France.... English population increased by 187% between 1770-9 and 1860-9 while a wide group of other European countries saw population increase by only 79%....

At the same time the addition of the acreage of North America, and improvements in the transport system that brought grain and timber from the East and South to Western Europe effectively expanded the land base of the whole continent.... The population fed and clothed by English agriculture did not expand from 7.5 million to 21 million between 1760 and 1860... but instead grew from 7.5 to 9.6 million... even this calculation does not take into account the effect of the expansion of the coal industry in substituting for the use of land to produce energy in the pre-industrial economy through growth of wood and furze. In combination imports and the coal industry effectively tripled the land area of England by the 1860s....

Thus England's economic growth looked so spectacularly different from the past after 1760 for three reasons: the demographic accident of the differential movement of population in England relative to the rest of Europe, the expansion of the land area effectively available to all of Europe through the opening up of the American Midwest and of the eastern Europe, and the expansion of the domestic coal industry...

The joker in Greg Clark's deck is the assumption that English population growth would have proceeded at the same rate in the absence of the Industrial Revolution. Without the technological revolutions, an expansion of exports to try to feed the growing population would have led to an exchange rate depreciation, a rise in the real price of food, misery, and a Malthusian "positive check."

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