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December 21, 2009


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Interesting ... however the hypothesis overlooks that the forces behind innovation and establishing capital intensive production (the industrial revolution) were for the most part those with wealth or connections to sources of capital in the unequal society ... it didn’t happen spontaneously from a lessening of inequality. Moreover the industrial revolution drove equality by increasing income for the formerly subsistence agricultural workers to create discretionary consumers (relative to subsistence). Then the industrial revlotion drove education for it own needs which further propels equality.

Tim Worstall

And what was inequality at the beginning of the Industrial Revolution? Maddison says the Gini was around 0.5.

Current UK market Gini is around 0.5. Adjusted for tax and benefits it's around 0.34.

So, perhaps we have too little inequality to support an Industrial Revolution of the Green type that everyone says we need?


The 1st century "steam engine" you cite wasn't much more than a useless toy and that they lacked the methods of scientific prcatice was probably the reason why it was never improved into a useful device. The Scientific Revolution occurred in the 16th and 17th centuries. The industrial revolution began soon afterward.

Andrew Kelly

The other question is why it occurred in England and one possible answer provides further anecdotal evidence for your hypothesis. The disolution of the monasteries spread wealth and power relatively widely. By the eighteenth century the descendants of the beneficiaries were literaly running the country following the glorious revolution. Edward VI's grammar schools were another egalitarian move that supported the changes instigated by his father.


The availability of coal changed everything. The crucial time and place is the 17th century around Newcastle. There was demand from other areas of the country, as wood became more scarce. The supply came from coal seams to the west of Newcastle, on hilly ground where the seams came to the surface. This required the development of wooden waggonways, which implied dozens of innovations to allow waggons to run along wooden rails on quite steep gradients to be transferred to keel boats and then to bigger boats at the mouth of the Tyne. This suggests a class of skilled craftsmen who innovated as they worked.

I have doubts whether the dissolution of the monasteries and the new grammar schools were key factors. Henry VIII had a habit of taking existing institutions and rebranding them under his own name. Monasteries were involved in a lot of practical activities, and were involved in small-scale coal-mining in the Middle Ages. Grammar schools didn't necessarily develop practical skills. It's the skilled workers, who found ways of getting loaded chauldrons of coal to run downhill safely on wooden rails, who were the key.


Perhaps the joint stock company made relying just on the brains of those few brought up in luxury no longer a constraint.


You reference Gregory Clark, but leave out one of his most salient points: In Britain just before the industrial revolution, there was a positive correlation between economic and reproductive success: The rich had more children than the poor. Combined with the principle of primogeniture (the entire estate going to the first son), this resulted in *downward* social mobility: Well-educated younger sons of aristocrats had to find employment in roles that in previous centuries had been beneath them.

This of course ties into process engineering: Now you had well-nourished and well-educated young men taking a critical look at things on the shop floor, and coming up with cunning new ways of doing things.

These days we do downward social mobility by proxy: Taxing the wealthy to pay for the education of the poor. If (and it's yet to be proved) this is less effective than genuine downward mobility, we need to consider whether (a) there is more to education than can be conferred in a classroom (illiterate parents can't read bedtime stories, for example) or (b) genetics play a significant role in determining who becomes wealthy and who does not.

john malpas

What about having more really good wars generating the need for progress. And maybe aquiring by the same means the capital goods to fund progress.

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Interesting post ! But there is one question in mind that is what was inequality at the beginning of the Industrial Revolution? And how it was handled ?

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