Figure 2.13: Wages Relative to the Cost of Capital Goods in England and France (Late 16th to Early 19th Century)

'The Industrial Revolution in Miniature: The Spinning Jenny in Britain, France, and India' (Allen, 2009)

Allen's High-Wage Economy Theory

Wages Relative to the Price of Energy in Six Cities (Early 1700s)

Synthesizing a Model and Historical Data to Explain the Industrial Revolution

Incentives for Technological Innovation

Imagine two pre-industrial economies, Country X and Country Y. In Country X, wages for workers are very high, but the cost of coal is very low. In Country Y, wages are low, while the cost of coal is high. A new invention, the steam-powered loom, is developed. It requires a large amount of coal to operate but significantly reduces the number of workers needed to produce cloth. Based on the economic incentives created by these conditions, which of the following outcomes is most likely?

Critique of Technological Determinism

Technological Adoption and Input Costs

An economic theory suggests that the path of technological innovation is driven by the relative costs of different inputs, such as labor and energy. Match each economic scenario describing these relative costs to the most likely incentive for technological development it would create.

An economic theory of technological choice suggests that if 18th-century France had experienced a sudden and dramatic increase in wages while its coal prices remained stable, this change would have created a strong economic incentive for French firms to adopt the same types of labor-saving, energy-intensive technologies that were being developed in Britain.

The Innovator's Dilemma in 18th-Century France

A key economic theory explains why certain technologies were adopted in some countries but not others during the 18th century. Arrange the following statements into a logical sequence that demonstrates how a country's specific input costs (e.g., for labor and energy) would lead to the adoption of a new, labor-saving, energy-using machine.

An economic model explains the Industrial Revolution's origin by arguing that firms adopt new technologies based on the relative prices of inputs like labor and energy. This model posits that Britain's uniquely high wages and cheap coal created a powerful incentive to develop and use labor-saving, energy-intensive machinery. Which of the following hypothetical discoveries would most seriously weaken this explanation?

Policy Evaluation for Technological Innovation

Wages Relative to the Price of Energy in Six Cities (Early 1700s)

Why was coal so important during the Industrial Revolution in Great Britain?

How did the use of coal impact the environment during the Industrial Revolution?

What was one of the key reasons Great Britain could lead the Industrial Revolution?

What was a major consequence of Great Britain's switch from wood to coal during the Industrial Revolution?

Counterfactual Land Use for Wood Energy in 1800 Britain

Energy Equivalence of British Coal Production in 1913

Energy Constraints and Industrialization

The Economic Shift from Surface to Subterranean Energy

Energy Sources and Industrial Potential

Evaluating Claims of Market Perfection

Match each energy source with its key characteristic as it relates to the economic transformation of the Industrial Revolution.

Energy Sources and Industrial Potential

Environmental Costs of Fossil Fuels

Wages Relative to the Price of Energy in Six Cities (Early 1700s)

Which of the following factors contributed to Britain's early innovation during the Industrial Revolution?

Why was the high cost of labour in Britain a significant factor in driving innovation during the Industrial Revolution?

How did the availability of cheap energy sources like coal influence innovation in Britain during the Industrial Revolution?

Which of the following best explains how the timing and location of Britain contributed to its innovation during the Industrial Revolution?

Model of Labour-Saving Technology Adoption and its Modern Application

Robert C. Allen

Figure 2.13: Wages Relative to the Cost of Capital Goods in England and France (Late 16th to Early 19th Century)

Role of Skilled Engineers and Machine Makers in the British Industrial Revolution

Video: Bob Allen Explains the Timing and Location of the Industrial Revolution

Persistence of Obsolete Technologies in Low-Wage Economies

Analyzing the Drivers of British Industrialization

Before its own industrialization, Britain was a major importer of affordable, high-quality textiles from India that were popular among all social classes. What was the most significant economic consequence of this high demand for foreign textiles within Britain?

Evaluating the Foundations of Britain's Industrial Dominance

Technological Contributions of Continental Immigrants to the British Industrial Revolution

Ready Availability of Coal in Britain

Britain's Geopolitical Dominance in Securing Industrial Inputs and Markets

British Agricultural Revolution

If 18th-century France had possessed abundant, cheap coal reserves similar to Britain's, it would have inevitably undergone an industrial revolution at the same time.

Consider a hypothetical 18th-century nation with vast colonial territories that provide both cheap raw materials and large markets for its goods. However, unlike Britain during the same period, this nation has a very large population, resulting in extremely low labor costs, while its energy sources are scarce and expensive. Based on the economic conditions that spurred early industrialization, what would be the most likely outcome for this nation's manufacturing sector?

Match each economic condition present in 18th-century Britain to its most direct consequence in fostering the Industrial Revolution.

Wages Relative to the Price of Energy in Six Cities (Early 1700s)

Global Diffusion of Industrial Technologies via Dominating Innovations