Why did the Industrial Revolution originate in Europe

Introduction

The Industrial Revolution is the process of change from an agrarian and handicraft economy to one in which industry and machine manufacturing dominate. The process began in Britain in the 18th century, expanding out to Europe where emulative industrialisation took place and from there it spread to other parts of the world. Mostly all regions have passed through the Neolithic revolution however, the Industrial Revolution is recent and is still an on-going process in many countries.

We must go back many centuries before this unprecedented event to discover the root of the Industrial Revolution and look to see why it is that it originated in Europe, in particular, Britain as opposed to other prosperous nations at the time such as China or India. My essay is split into two parts as is my explanation where I will largely focus on two dominating factors that I believe contributed to this; the innate features of Britain predisposing them towards a route of industrialisation and the features that other prosperous nations lacked inhibiting the start of an Industrial Revolution.

Factors Leading to Industrialisation in Britain

British industrialisation was spontaneous and was not orchestrated however, we must consider inherent characteristics that made Britain an ideal location for industrialization to occur. Firstly, we can consider a critical turning point for Britain, the Agricultural Revolution which took place in the 18th century. This gave Britain at the time the most productive agriculture in Europe, with yields up to 80% higher than the Continental average. Furthermore, the increase in the food supply contributed to the rapid growth of the population and meant that families in Britain were able to buy manufactured goods utilising the extra money that they were now able to accumulate. In addition to this, the rise in productivity accelerated the decline of the agricultural share of the labour force, adding to the urban workforce on which industrialisation depended. For example, workers were freed up to other sectors of the economy resulting in the migration of farmers from rural to urban areas in search of labour; this according to Chappine created a ready pool of workers hence contributing to building the foundations for a favourable environment for industrialization.

Furthermore, Britain had valuable assets such as raw materials and an abundant supply of coal and iron ore giving them advantageous factors and arguably leading them towards a path of industrialisation. If we go back to the 1400’s, we can examine that England started to diversify its activity; moving away from agriculture and towards manufacturing and services. For example, we can observe that agriculture’s share of GDP fell from 46% in 1400 to 22% in 1840. Overall in Britain the manufacturing sector was completely transformed, this was partly due to new sources of energy being discovered including electricity, gas and nuclear and materials such as wood and stone were replaced by iron and steel.

Another important change that occurred was in the iron industry. During the early 18th century, a revolutionary change in the production of iron took place as a new method of smelting iron by using coke was discovered. Manufactures could now use their surplus of fuel reserves to process iron ore as the coke could heat iron more quickly than charcoal, thus production rates increased. This iron was conducive in creating industrial machinery and subsequently aided the construction of railroad lines.

REF ( whole paragraph = source ) Furthermore, the first Industrial Revolution would not have been possible or would have not taken place in Britain without some critical technological advancements. Firstly, if we look at the 1760s, we can see how the steam engine, developed by James Watt transformed the cotton industry as the furnace ovens could now be heated more quickly and effectively. The earlier machines were powered solely by water however, these steam engines were powered by coal meaning that factories no longer needed to be located next to sources of water, making it a lot easier for them to be set up. In 1787 this was succeeded by Edmund Cartwright’s power loom which revolutionized the speed of cloth weaving.

Britain essentially started moving away from having “cottage industries” to having newly built factories. These factories were able to be built as Britain vitally had multiple advanced financial institutions, such as a central bank. This enabled entrepreneurs and investors to obtain credit on a large scale that was necessary to build factories and install machinery in them. Britain was one of the first places to establish a modern financial system that facilitated significant investment in new machinery and new industrial practices, at the time no other country had a comparable system for financing, producing, and distributing the products of industrialization. As the invention of machines started to rapidly develop it had an unprecedented impact on the economy; these new machines were capable of replicating and even improving human accomplishments.

Cotton is arguably one of the most important factors to consider; in the 18th century, Britain’s cotton industry advanced rapidly compared to other countries. James Hargreaves’ invented the Spinning Jenny in 1764 and this meant that yarn could be produced in much greater quantities. Soon after in the 1800’s began the mechanisation of weaving in factories. Consequently, from the 1800-1850’s cotton manufacturers took up more than 40% of the value of annual British exports. This was not always the case; in 500BP India was a major manufacturer and exporter of textiles such as silks and cotton. However by the 18th century, the UK demand for cotton manufacturers expanded which left scope for import substitution; foreign imports were replaced by domestic production. British manufacturers were unable to use Indian methods of production which were very labour intensive, this was because UK wages were high, therefore there was a search for labour-saving technologies and new innovation. Due to this increase in new technology and innovation, labour productivity increased resulting in lower average costs for British manufacturers. Eventually, this led to the demise of India’s indigenous manufacturing. This represents the neo-classical view that Allen (2012) proposes, he argues that high wages in Britain is what encouraged people to innovate, and hence helped to drive the Industrial Revolution in Britain. In addition the profits Britain had accumulated due to its successful cotton and trade industries allowed investors to support the construction of factories.

One final factor we cannot overlook is the tremendous empire that Britain had. Pomeranz states that the Industrial Revolution began in Europe because it had superior access to natural resources thanks to its colonial empires. By 1815, Britain possessed a global empire that was hugely impressive in scale and bigger than that of any other European state. Their global market for factors and goods expanded throughout their empire and across the Baltic region, North America and Asia which gave it boundless access to raw materials and new markets. This led to the development of trade and rise in businesses through the colonies, in particular through the activities of East India Company which rose to account for half of the world’s trade. This vast trade empire also created extensive demand for British goods as there was a large supply of consumers who were both willing and able to purchase the manufactured goods. This resulted in more production and hence a higher demand for labour. Furthermore, Britain enjoyed tremendous political and economic stability due to its large empire, therefore British entrepreneurs were more ardent in taking risks to make profits, these entrepreneurs were essentially leading the way of industrialization. They were able to do this as the private sector essentially had more availability to take risks which ultimately paid off. Thus, we can defensibly assert that the industrial revolution may have been funded by colonial wealth. As India and China were both under control of Europe by the 1800’s they subsequently lagged behind when the industrial revolution was going on. They also had no colonies of their own, therefore their markets were limited along with their access to raw materials hence, their potential for greater economic development was limited.

Why Did Other Prosperous Nations Fail to Industrialise First

Instead of looking to see why Britain industrialised first, we can instead look at why other prosperous nations did not. It can be argued that one essential element that these nations lacked was having necessity. Necessity is without a doubt a fundamental driver of innovation and without it, there is no desire or motivation to innovate. The reason as to why European nations in particular, Britain industrialised can be attributed to the unexpectedly high growth in the population around the mid-18th century which produced a large supply of workers. Simultaneously in order to compensate, the invention of more efficient methods of production such as the development of machines became a necessity in order to supply the basic needs of such a large group of people. As a result, Britain enjoyed two significant advantages: not only an extremely productive and wealthy agricultural system, but also an impressive number of creative inventors. On the contrary, India had abundant manpower, hence machines were not a necessity and they saw no need to increase their usage of them. Arguably, industrialisation could of happened in other nations but at that point in time they didn’t need it nor were they looking for it.

I am going to consider the case of two countries of which were particularly powerful and prosperous and look to see why they did not industrialise first. If we first consider China and look at some of the reasons as to why the Industrial Revolution did not begin there, we can observe that there was seldom a lack of labour in China due to the rapid growth of population. Due to this, there was less incentives to use machines or even to search for labour-intensive methods in order to substitute for a lack of labour or low productivity. Furthermore, in the past, China never relied on international trade and its economy was formed in such a way that there was a need to mass-produce within in a short period. In this way it differs from other smaller European countries, where no one country had everything and thus everyone relied on trading. It is true that with trading comes innovation, and with small populations comes industrialisation of manual labour, this is something that China lacked. There’s no question that in the past China had achieved promising scientific advancements, however they were never able to successfully turn this into economic growth as the West did. Swanson argues in her article that the fundamental difference here between China and Europe arises due to the fact that China had Confucian ideals which valued stability and security and frowned upon experimentation and change; this was a key downfall. They achieved stability for a long time however, the Europeans didn’t want stability instead they wanted progress and that’s what they got. Thus, for China as a whole, both the incentive and the means to take the industrial route were meagre or absent.

Now, we can consider yet another prosperous nation; India. During the 17th and 18th centuries, India was commonly known as “the industrial workshop of the world” and was debatably on the road to some form of industrialization. However, this was before the British conquest??????, which subsequently made industrialization difficult. As India was under British rule since 1757, the British Government found it both unprofitable and unnecessary to initiate industrialisation in India. Instead, being a colonial country, India had to pay a large price for England’s industrialization scheme, they were forced to supply raw materials for generating the Industrial Revolution in England. India was then forcibly transformed from being a country of both agricultures and manufactures into an agricultural colony of British manufac¬turing capitalism. Being an agricultural country there was less of a need for the development of machines furthermore, Yadav mentions that with its high population Indian merchants could still make a lot of profit without all the machinery, so there was also no need to invest in new production methods. Hence we can conclude that India neither required an Industrial Revolution nor would it have been able to easily industrialise in the first place due to its status as a colonial country.

The great divergence is another significant factor to consider. We can firstly look at the global distribution of GDP. From 1500 to 1900 countries such as the UK and the US increased their shares of GDP from around 1.1% to 9.4% and 0.3% to 15.8% respectively. Whereas other countries such as China and India who had a high global distribution of GDP in 1500, saw this figure fall by 1900. For example, China’s fell from 24.9% to 11.1% whilst India’s fell from 24.4% to 8.6%. It is important to consider and observe these change and understand why they took place. We must look at the downfall of these once prosperous nations and see what enabled the other countries to overtake them. Kenneth Pomeranz’s The Great Divergence (2000), has suggested that China’s level of economic performance was relatively similar to that of Western Europe. Pomeranz states that fortunate geographic circumstances such as the availability of cheap coal in the right places is the reason as to why the Industrial Revolution occurred in England. This can explain the divergence of these two countries as it contrasts to China where the location of their coal was in the North and economic activity was centred around the South, making the coal relatively inaccessible. Furthermore, as the European countries also had access to colonies this gave them an advantage and led to higher levels of growth, China and India both lacked this

One final aspect that we can consider is the lack of good institutions in the once prosperous nations. We can look at the Atlantic trade which is arguably a critical juncture in history in order to examine the effects of this. As a result of the Atlantic trade some European countries greatly benefited however, other countries such as China didn’t. In theory it should have benefitted as its sailing technology was a lot more advanced than Europe however, it is important to consider why it didn’t. One main reason was due to institutional reasons; imperial decree in China from 1450 meant that attempts at long-distance navigation was halted, hence international trade was severely restricted. This was due to the inordinate power of the emperor, if the emperor had been less powerful he would not have been able to block foreign trade and expanded markets would have instead induced people to innovate more. If we take an institutionalist view, we could say that China’s institutions prevented it from being the first place to industrialise. Before 1949 the country was under absolutism, the Ming and Qing dynasties focused on building a strong state to control and tax people rather than incentivise private profit. On the contrary, Britain had better political and thus economic institutions in the 18th century, due to the Glorious Revolution of 1688. Thus it was Britain, not China, who had secure property rights, contestable markets, a fair and efficient judiciary and an efficient financial system. Britain’s inclusive economic institutions led to economic growth as well as inclusive political institutions which are required for good economic institutions. China, on the other hand had exclusive institutions, prohibiting any vital advancements in trade or innovation.

Conclusion

Industrialisation is an unprecedented event, thus we cannot simply pinpoint one exact reason as to why it originated in Europe rather than elsewhere however, we can consider multiple factors that combined to provide this outcome. From examination, we can observe factors preventing other prosperous nations from industrialising when they appeared to be the most obvious candidates. Most of these factors are comprised of lacking the necessity and the means to industrialise. The requirements for industrialisation differ from what constitutes a powerful and prosperous nation and the two do not go hand in hand, hence explaining why India nor China was not first to industrialise.

On the contrary, it is clear that some of the most significant points raised have been about how Britain was on the route to industrialisation centuries before it even occurred. It had many ideal conditions such as the right environment, relevant technological advancements and a global empire thus making it an appropriate location. Furthermore the establishment of the Bank of England in 1694 as the world’s first central bank combined with growing economic prosperity from overseas trade throughout the 18th century meant Britain had a widespread, efficient, and reliable national banking system.

Britain had the necessary natural resources, was stable and had a strong economy thus it was the most adequate country at the time for industrialisation to occur. The process of industrialisation is a transformative event and is still an on-going phenomenon, we can conclude that even though a few centuries ago, agricultural empires such as the areas now corresponding China or India had been exceptionally prosperous, powerful, inventive, well-organised and cultured, they lacked the necessary requirements for industrialisation which were set in place many centuries ago.