Robert C. Allen , The British industrial revolution in global perspective ( Cambridge : Cambridge University Press , 2009 . Pp. xi + 331 . 38 figs. 10 plates. 21 tabs. ISBN 9780521868273 Hbk. £45/$85 ; 9780521687850 Pbk. £16.99/$27.99 ) This work is ground-breaking. It expounds a forceful new thesis and introduces the early fruits of major international comparative statistical work on growth data. All future research on British industrialization and comparative global history will have to take note and make its way in the light of this volume. The book is didactic in tone and certain of an argument that rests on comparative wage and price data, bolstered by a simulation exercise and by narratives of inventions and inventors in major sectors. Allen argues that the reason why England was the first to industrialize and to gain a lead in the development of labour-saving and energy-using technologies was that the country had a unique combination of factor prices. Real wages were generally high whilst energy costs were relatively low. This conjunction did not occur anywhere else in the world in the seventeenth and eighteenth centuries. Nowhere else did the promise of future profits justify the costs of development of labour-saving technologies from invention to the point of their effective innovation. It was thus neither economical nor rational in any other location to struggle to invent new productivity-enhancing manufacturing technologies, or to pay the price of developing and of innovating such new methods. Several decades later, and thanks largely to British advancement with micro-inventions which had no bias in favour of saving one factor more than another, factor price combinations in other countries began to change. Only then did incentives shift to favour the spread of innovations that substituted capital for labour so that the cotton mill, steam engine, and coke blast furnace became ‘globally appropriate technologies’ (p. 3). Explanations that foreground war, institutions or culture are therefore unnecessary: ‘there was only one route to the twentieth century—and it traversed northern Britain’ (p. 275). Indeed, ‘had the first step not eked out a profit in England, the technology might never have been developed, and we might still be smelting with charcoal’ (p. 237). Allen is not the only historian to have concentrated upon the history of wages and prices in the Great Divergence but he, with collaborators, has established new comparative indices of wage levels for western Europe and Asia, reduced to a silver standard. He shows that all parts of England had exceptionally high silver wages. London and the south-east benefited first, but rapid growth towards the end of the eighteenth century brought the north up to comparable levels. In real terms Allen estimates that average wages in London were five or six times the level of basic subsistence, whereas poorer parts of Europe and Asia, as a whole, had average wages around the subsistence level. He argues that the high cost of labour relative to fuel created a strong incentive to substitute fuel for labour in Britain whilst the reverse was the case in China, for example, where fuel was expensive compared to labour. By similar reasoning coke smelting was not profitable in France or Germany before the mid-nineteenth century. High wages impacted upon the demand- as well as the supply-side of the economy. The rewards to labour, particularly skilled labour, created the foundations for the buoyant demand for manufactured goods internally. They also made possible higher investment and achievement in literacy and numeracy and thus increased the receptivity of the population to the acquisition of technological skills. Allen's story starts with the important turning point of the Black Death. He argues repeatedly that the huge population losses resulted in the extension of pasture, the development of longer-stapled wools and the consequent success of the new draperies which was boosted by the export tax on raw wool. The success of textile proto-industry in the early modern period created the high rural non-agricultural and urban shares of the population and the almost uniquely high wage economy of the eighteenth century. That this success was aided by favourable institutional and cultural developments by state formation and aggressive mercantilism is explored and subjected to some indicative but basic statistical testing. Fortunately, Allen's thesis does not rest exclusively on the results of these simulations which are stretched to their limits. The emphasis is placed upon the factor cost outcome coupled with a fairly traditional reliance on the incidental importance of cheap coal. These were the sources of technological innovation and of self-sustaining growth thereafter. Allen's explanation is in line with other factor endowment-driven accounts and is not novel in this respect. Indeed, it is proffered explicitly as a prequel to the Habbakuk thesis on factor-saving bias in American and British technology in the nineteenth century. All such accounts rely on the premise that factor markets are more or less integrated within countries so that surviving partial data can be used as a proxy for national cost levels and, more importantly, so that factors of production can be regarded as substitutable. Although there may be grounds for such assumptions for parts of western Europe by the eighteenth century, in most of Asia, and in other global regions encompassing massive landmass, this clearly did not happen and it is therefore difficult to make the international comparisons upon which the author relies. In east Asia relatively high interest rates appear to have led to more efficient institutions for the use of labour, creating an industrious revolution but one that had a path different from that experienced in the West. Much of the economic progress made during the later nineteenth century was not based on the adoption of western technology but upon the indigenous development of labour-intensive industries and labour-absorbing institutions. As Kaoru Sugihara has argued: ‘East Asia would not have industrialised without Western influence but it was the East Asian path of economic development that made it possible for the majority of the world's population to benefit from global industrialisation’ (Giovanni Arrighi, Takeshi Hamashita, and Mark Selden, eds., The resurgence of east Asia: 500, 150 and 50 year perspectives, 2003, emphasis added). In Meiji Japan, capital was substituted for labour but industrialization remained labour-intensive in a way similar to the dominant patterns of industrialization in the contemporary world. It is certainly premature to return to a narrative of exclusively British precocity or the idea that industrialization followed a single path with later industrializers copying slavishly this as soon as factor prices were conducive. Although this is not Allen's primary purpose, others may lean on his thesis to do so. One might also question Allen's reasoning closer to home. Throughout the book he rather unforgivably refers to Britain and England as if they were interchangeable. Clearly most of Wales and Scotland experienced much lower wages than much of industrializing and commercializing England, through the whole period of British industrialization. In Allen's own account, the high wage economy was confined to London in the seventeenth century and did not spread to the north of England until the industrial revolution was well into its stride. The most innovative regions and sectors, technologically speaking, were thus by no means congruent with high wage areas or sectors. This highlights the wider problem of the national level of analysis and national average comparisons even for the relatively integrated economy that Britain presented by the eighteenth century. Allen does mention this as a problem but dismisses it too readily. Allen's rejection of the stress placed by other writers on the industrial enlightenment in Britain is also rather weaker in substance than he implies. His argument is based upon a study of the connections between science and practical industrial applications in major sectors by looking at the backgrounds, methods, and contacts of major inventors. Seventy-nine are studied of whom only 14 were born after 1750 which to my mind restricts the results. These are in any case inconclusive, with those engaged in steam power innovations having close connections with science but others much less so, although it is accepted that the eighteenth century witnessed a major increase in the use of experimental methods. This is the launch volume of the series ‘New Approaches to Economic and Social History’ edited for the Economic History Society, and Allen has tailored his style to an intended market of undergraduates. He is admirably clear in his arguments but I am not sure that most bright students will thank Allen for repeating the same points many times and for his colloquialisms (for example, ‘chucking’ fuel on the fire, p. 90; ‘hoi polloi’, p. 241). Those academics who have spent the last decade trying to keep students away from Wikipedia will not thank Allen for using the site several times as a source, though others may see this as a brave move. The series sets itself the difficult task of combining work that is ‘academically ground breaking’ but which also offers a ‘comprehensive guide’ to a topic that is ‘accessible to advanced school students and undergraduates’ in history and in economics (Frontispiece). This work is original and accessible but it does not aim to provide a comprehensive guide to the industrialization process and should not perhaps be promoted as so doing. It might also be criticized for resting such a confident and closed case on sparse data, basic simulations, and some indicators from the collective biographies of a restricted field of British inventors. Finally, perhaps the global perspective should be applied in a broader sense: in the eighteenth century the population of China rose to 400 million without significant loss of living standards or demographic catastrophe. China's share of world GDP in the early nineteenth century was around 30 per cent, Asia's 50 per cent, and Britain's 6 per cent. Taking both a short and the longer view, we still have much to learn from the East as well as the West about global growth past and present.
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Pat Hudson (2009) studied this question.