Reassessing the Industrial Revolution:
a Macro View
C. Knick Harley
Since the mid- nineteenth century, the standard of living in Western Europe and its offshoots has increased steadily. The relationship between the human population and the environment changed, apparently as a result of the Industrial Revolution in Britain between 1750 and 1850. The change was dramatic, perhaps comparable to the Neolithic development of settled agriculture, and needs to be explained if we are to understand modern economies. The Industrial Revolution led to factory industry, the modern industrial city, and an urban industrial proletariat, but recent reassessment suggests that the sudden Industrial Revolution was not the only engine of modern growth. The eighteenth and early nineteenth centuries need to be examined anew for other sources of growth.
Recent demographic history provides a long perspective on European growth (Lee, 1973, 1988; Wrigley and Schofield, 1981). Juxtaposing English population and the real wage of workers for the last seven centuries (Figure 3.1) reveals dramatic change about 1800. In earlier centuries over long periods, real wages rose and fell in inverse relationship to population, but real wages were without secular trend. The Black Death in the fourteenth century killed about a third of England's population, and population remained low until the early sixteenth century.Workers in the smaller population enjoyed nearly twice the real wages of their pre-plague ancestors. Population then grew during the sixteenth and first half of the seventeenth century, and wages fell to pre-plague levels. History conformed to economists' theoretical expectations, first developed by David Ricardo about 1800, that wages in an economy constrained by limited resources vary inversely with population.
Since Ricardo's time, wages' inverse relationship to population has disappeared. Between 1820 and 1980 English population grew from 11.5 million to more than 45 million (a rate of 260 percent per century). In the previous five centuries, population grew about 14 percent per century and, roughly, technology and capital stock improved enough to maintain the standard of living. The statistics are imprecise, but the broad picture is clear: The relationship of population to environment changed radically. The transformation of the European economy is