Technological Change and Economic Growth 1750 – 1900

We can start from sentence that Great Britain with whole confidence was the country which technology dominated on international market in the time of first and second Industrial Revolution. There is no doubt that economical growth of it definitely made it superior to other countries. Why it happened to be like this? We can mention right away few reasons for that state, namely geographical localization and communication made it not only independent from Continental problems but also derived fresh ideas and solutions.

Moreover political system made government to care deeply about property rights of Britain citizens, what encouraged them even more for being innovative. In economical and social perspective dominating factors are practical skills of labour force and openness for foreign technical abilities despite of inventors social and religious status. Nevertheless it is not enough, so in further part of this essay there is enclosured explanation for that situation. We have to treat technology as a phenomenon determined by many factors, not only ability of human for being creative and practical.

Following this thought it is crucial to start from trying firstly to understand technology in general, elaborating topic by factors which made Great Britain economy dominating to other European countries, finishing with specified innovations which made Britain economy grow. We can say that statements like “necessity is the mother of invention” do not have really sense in this context. On the contrary we can say that “invention is the mother of necessity” given the fact that new technologies often give rise to unrecognised desires.

The demand for technology is derived because it depends on demand of goods and services that technology helps to produce. Technology change is principally produced because of new ideas that are born in a way that is difficult to predetermine and completely understand. It can be that demand focuses the direction of these new ideas, but is sure that it does not determine the creativity of societies. Cannot be said that demand is not important in this context, but that there are not going to be a symmetry between supply and demand in the production of technological progress.

By 1700 Europe was already richer than non European countries, one explanation of that is technological progress. Technology influences a lot the income of the states and its success. Technology and its development is a really complex thing to explain and understand. This complexity derives because of the cultural influence. For existing technology development we need a cultural predisposition and preparation that does not occur in all societies. Investing in technology is also expensive.

In the period of the Industrial revolution there were a lot of things that make this kind of research difficult, such as, high costs, a groups of individuals willing to absorb large risks and wait a lot of years for the pay off, etc. Risk aversion and leisure preference are thus what determine the rate of innovation in a particular society. The total cost of adopting a new technique consists of two parts: private costs paid by investors and the social costs paid by society as a whole. Social costs usually exceeded the private costs. There is nothing natural and inevitable about technological progress.

Most societies experienced that , but only the West was able to transform it in a mechanism of continuous expansion. Technologically creative societies in the past and in the present create “free lunch” benefits. At the end, it all depends on the combination of luck, brilliance and perseverance. Nevertheless in every society exists a need of stability. The sentiment more representative of this is “ if it ain’t broke, don’t fix it”, the arch-enemy of technological progress. Technological conservatism refers to the tendency to adopt a certain technique only because it happened to be used in a previous period.

On the collective level it is possible for societies to be conservative even when individuals are not. This happens when well organised interest groups in a society have a stake in maintaining the status quo in the face of superior alternative. Technological conservatism produces an economic inertia; pervasive influence of the status quo, tradition, custom, routine, and adherence to precedent were powerful obstacles to innovation and advances. Technological changes is like a game against nature. Invention occurs at the level of individual creativity.

What makes them implement, improve and adapt new technologies in the way that they carry out their daily work, depends on the institutions and the attitudes around them. It is this the way that the level of technological changes is transformed from invention – a game against nature, to innovation – “positive-sum game with many players and very incomplete information”. Mokyr makes an analysis of which factors help determine the prosperity of the member of the society to invent and which factors make others want to adopt his or her inventions.

There are many things that influence technological progress and if it is going to be realised, how, in which kind of societies, culture, and conditions. Mokyr explains that life expectancy is an important factor for technological progress. People who live short have little time or incentive to generate new knowledge. Another important thing is the nutrition. It is reasonable to expect that in societies in which hidden hunger is rampant, initiative and ambition, necessary for economic progress will be harder to find. Willingness to bear risks also affects society’s ability to produce innovative individuals.

In the past the risk was bigger than today, experimenting new techniques or crops might well have entailed a risk of starvation. Also geographical environment is important, few of the environmental factors are either strictly necessary or sufficient, they are permissive rather then causal in direct sense. Another factor is “path dependency” in which the views, that technological change depends primarily on, is past. Technological change tends to be local, that is, learning occurs primarily around techniques in use, and thus more advance economies will learn more about advanced techniques and stay at the cutting edge of progress (David, 1975).

High wages and labour scarcity stimulated technological creativity (Habakkuk thesis, 1962). Religion can see at this kind of changes like something that goes against nature and what God creates for us. To make technological changes effective and sustainable, the authorities must relinquish their direct control over the innovative process and decentralise it. This is the opportunity for successful innovators to enrich themselves. It is difficult to determine what kind of political structure is most conducive to technological progress.

Strong centralized governments may have been able to resist the pressures exerted by technological status quo. It is equally possible that a weak government leave the decision to market forces. Another reason politics matters is that technological changes is notoriously subject to market failure, that is, the free market system left on its own is unlikely to produce a desirable level of innovation. So for making technological changes we need openness to new information and adaptation.

Wilkinson proposes an original theory connecting population, the physical environment and the rate of technological change (1973). Such theory says that technological changes occur when the ecological equilibrium between population and resource is disturbed. When population growth occur “society will try to find ways of developing its technology to increase the yield from its environment” The British Industrial revolution, in his view, was the result of acute resource shortages resulting from the resurgence in population growth in the last third of eighteen century.

This interpretation does not really have connection with reality, because technological innovation simply had nothing to do with ecological pressures and occurs in societies in which population was in fact more or less stagnant. So let take a look on the other factors which determined the situation. After 1750 the Industrial Revolution was initially concentrated primarily in Britain. In this period a deep gap between Europe and Great Britain had existed. In this part of essay we are trying to find an answer why the Industrial Revolution had appeared in Britain, comparing all process of technological changes in Britain and the rest of Europe.

Technological success depended on both, the presence of positive elements and on the absence of negative ones. Among the positive factors, the generation of technological ideas and the ability to implement them seem a point natural enough from which to start. The generation of ideas was often an international effort. The British were prominent in providing techno-Britons. Yet Britain’s relative role in invention was smaller than its corresponding role in implementation. Many important inventions that can be attributed to Continental inventors found their successful implementation in Britain.

There are many difference between Britain and the Continent that helped Britain to establish its head start. It needs to be divided for few parts: geographical, economical, political, social and technical aspects. Let’s start from geographical situation – location of Great Britain is perfect for sea – trade development. Also having a lot of colonies almost on over the world, favors to create a ideal conditions for big technological changes. Because of Britain’s location Britain alone among the large European economies constituted a comparatively unified market in which goods and people moved easily.

Compared to the European Continent, Britain had excellent internal transportation, canals and roads provided it with a network unequalled by any Continental nation, with the possible exception of the Netherlands. As the technology of building roads and canals improved in the 18th, Britain became an integrated market system, in which size and integration is very crucial. Market integration has a more profound effect on the diffusion of new techniques. British political system is also cause of the Industrial Revolution.

Perhaps the most distinguishing feature of Britain was that its government was one of, by, and for property owners. Very important issue here is effect of patent laws on inventive activity. If we compare patent law in Britain with the rest of the Continent we’ll see deep gap between them. British patent law dates from 1624, whereas France did not have a similar law until 1791, and most other European countries established patent laws only in the early 19th century. Generally, property rights allowed the inventor to capture a larger part of the social benefits of his invention.

Also crucial factor was its endowment of skilled labour at the onset of the Industrial Revolution. By the middle of the 18th century, Britain had at its disposal a large number of technicians and craftsman who could carry out the mundane but indispensable construction details of the “new contrivances”. This skills rested on an informal and antiquated system of apprenticeship and on-the-job training – they had little to do with schooling. They had got more practice skills. The best example here is clock- and watchmaking and also shipping sector.

By contrast with France, Britain welcomed men of technical ability whatever their religious persuasions. Landes wrote that France had been “crippled by the exodus of some of its best practitioners fleeing a wave of anti-protestant bigotry”. Besides this two sectors also mining helped to prepare the skills and dexterity necessary for the Industrial Revolution. Pumps and transport equipment were crucial to mining, and both the steam engine and the iron rail were built first for use in the mines.

By the end of the 17th century, British mining and metallurgical technology was still ‘between a hundred and hundred and fifty years behind the best practice techniques of the Continent’. By 1760, it was at the forefront of Europe in these areas, giving it a technological advantage. Furthermore, in Britain the number of engineers and mechanics was sufficiently large to allow interaction with each other – interaction among engineers, scientists and businessmen created a total that was larger than the sum of its individual components.

Technological change and the creation of new information are processes that do not obey the laws of arithmetic. On the other hand, Britain did not have a significant scientific advantage that would explain technological leadership: as Kuhn notes, the traditional view that British science was predominantly experimental and mechanical, whereas French science was largely mathematical and deductive seems to have withstood the test of time.

Thanks that a lot of inventions was coming into existence in Great Britain. Which are described in the next part. There are some conditions to have a technological change, first of all an opportunity for improvement owning to the inadequacy of prevailing techniques or a need for improvement due to an autonomous factors price increase, the new technique must also pay sufficiently to cover the costs of the change.

The technological change focuses on tree principal sectors: energy, cotton spinning and iron making; in this part we are just trying to report those changes which have had enormous consequences in the production system of this period. One of the most frequent symbols of the industrial revolution is the steam energy, stem energy is probably one of the most revolutionary invention ever made and allow a controlled conversion of heat in work, any way it’s impact before 1850 on the industry productivity was limited.

Before 1830 the use of steam energy could be substitute by alternative sources, especially water power, which technique improved also a lot during this years, an example of this came from the Swiss production of iron before 1830,based on water energy and caracole, the Swiss iron was more expensive but can compete with the British one by saving transport costs and because of his quality. A second industry which also were protagonist of lots of important changes in the production is the cotton spinning industry, we can connect this change to tree names, first: Richard Arkwright, the inventor of the throstle”, this technique allow a faster production ( from 6 to 24 time faster) and at the same time a high quality product. The second name is James Hargreaves, the inventor of the “spinning jenny”, this technique twisted the yarn by rotating spindles that pulled the rowings from their bobbins, with metal draw bars playing the role of human fingers. The spinning jenny is a quite small machine but made the spinning process about 100 times faster.

The third inventor is Samuel Crompton who combined the “throstle” and the “jenny” technique crating the mule, a machine able to produce with the “jenny” speed a high quality product like the one of the “throstle”, with this invention Britain can definitely compete with the Indian fine quality yarn. A third sector characterizing the industrial revolution is the iron sector; this is probably due to it’s nature of general purpose material, which had no substitute at that time. The first type of iron was the “pig iron”, produced with a high carbon level that makes it rigid, hard and fragile.

In 1710 were introduced the coke smelting iron, but until 1750 this new product was not widely used; the reduced costs of pig-iron allowed the use of cast iron in many more applications, especially in constructions. In this case the innovation is not due to the costs of the material but to his resistance to fire hazard, caused by an increase in the use of steam energy in the textile mills. In 1785 Henry Cort introduces the puddling and rolling techniques, Cort combinate the reverberatory furnaces used in glass making with groowed rollers and start using coke as fuel.

Reassuming in few sentences, important is to remember how big role had played urbanisation, demographical growth and a little bit to colonialism. We cannot concentrate only to already mentioned issues, but nevertheless they are those which dominate along whole situation, according to specification in topic of technological development. All in all Britain’s domination was the effect of multiply variables which strengthen its position for few centuries.