11 - From Industrial Revolution to modern economic growth

Summary

The industrially more developed country presents to the less developed country a picture of the latter's future.

Karl Marx, Capital, vol. I, preface

I have argued that the famous inventions of the British Industrial Revolution were responses to Britain's unique economic environment and would not have been developed anywhere else. This is one reason that the Industrial Revolution was British. But why did those inventions matter? The French were certainly active inventors, and the Scientific Revolution was a pan-European phenomenon. Wouldn't the French, or the Germans, or the Italians, have produced an industrial revolution by another route? Weren't there alternative paths to the twentieth century?

These questions are closely related to another important question asked by Mokyr: why didn't the Industrial Revolution peter out after 1815? He is right that there were previous occasions when important inventions were made. The result, however, was a one-shot rise in productivity that did not translate into sustained economic growth. The nineteenth century was different – the First Industrial Revolution turned into Modern Economic Growth. Why? Mokyr's answer is that scientific knowledge increased enough to allow continuous invention. Technological improvement was certainly at the heart of the matter, but it was not due to discoveries in science – at least not before 1900. The reason that incomes continued to grow in the hundred years after Waterloo was because Britain's pre-1815 inventions were particularly transformative, much more so than continental inventions.