The chapter I am going to review is from the book “A farewell to Alms”. It discusses the divide between rich and poor nations that came about as a result of the Industrial Revolution in terms of the evolution of particular behaviors originating in Britain. Prior to 1790 man faced a Malthusian trap: new technology enabled greater productivity and more food, but was quickly gobbled up by higher populations.
And the the author of this book that had mixed reviews but evaluated the book as well written and interesting is Gregory Clark a professor of economics and department hair until 2013 at the University of California The Industrial Revolution, the escape from the Malthusian trap, was a great breakthrough in human history that in many ways (higher standards of living, housing, population increase and so on) forever changed the lifestyles of millions of people. So far no one has fgured out why the Industrial Revolution was delayed until around the 1800.
Even though there are many different theories trying to solve the puzzle of the Industrial Revolution all of them face some problems and Gregory Clark tells us about the main theories and gives us is reasoning as to why explaining the Industrial Revolution is an almost impossible challenge. Since the industrial boom had such a huge impact on humanity I believe that the problem Clark is mentioning is highly important because complete knowledge of how it all began may trigger a new wave of modernizations and different transitions.
Even though I don’t agree with everything Clark says (more on that later) it is amazing how much effort he put in his book considering that he spent 20 years scanning medieval English archives to give us his ideas on the troublesome uestion my essay is about. His opinions are well argumented and even if it is hard to agree with some of them it is even harder to constructively disagree.
In my essay I will give you a brief summary of what Clark writes about and then carefully analyze it to give my personal opinion on the topic of why the Industrial Revolution happened so late even though there were economically stable countries much earlier such as ancient Babylonia and Greece As I already said, the article IVe read has some interesting points that are well rgumented and wisely asked questions like “What was different about all preindustrial societies that generated such low and faltering rates of efficiency growth?
What change to such a stable nongrowth configuration generated the Industrial Revolution? ” Clarks book adopts the view that the Industrial Revolution emerged only a millennia after the arrival of institutionally stable economies in societies because institutions themselves interacted with the changed human culture. Malthusian pressures rewarded effort and fertility limitations which facilitated modern economic growth. Clark states that all the theories offered by historians fall in to 3 major groups: Exogenous Growth Theories, Multiple Equilibrium Theories, Endogenous Growth Theories.
Exogenous Growth theories attempts to explain long-run economic growth by looking at productivity, capital accumulation, population growth, and technological progress. However Clark says two considerations suggest that these theories face almost insurmountable problems. First of all there is no sign of any improvement in the appropriability of knowledge until long after the Industrial Revolution was well nder way. Secondly there is no evidence that in the long run institutions can be a dertermining factor in the operation of economies.
The Multiple Equilibrium theories is a class of theories in which families switch from an equilibrium under which everyone has large numbers of children ( all the children get invested little time in) to one under which families have a small number of children ( all of the children get lots of attention). Endogenous growth theories holds that economic growth is primarily the result of ndogenous and not external forces. Endogenous growth theory holds that investment in human capital, innovation, and knowledge are significantcontributors to economic growth.
The theory also focuses on positive externalities and spillover effects of a knowledge-based economy which will lead to economic development. Lots if economists now think that efficient institutions promote economic growth. Well-defined property rights, freedom from expropriation, unimpeded markets, and minimal government are a common recipe for success. Clark opposing to lots of istorians does not agree that institutions are an explanation of economic growth. Clark questions the role of institutions a lot of times in his work.
He is enthusiastic about the argument that inefficient institutions cannot persist for long because everyone could gain from reforming them. Slavery and serfdom are his examples: if these institutions were inefficient then the slaves and serfs should have been able to buy out Institutionalists would respond (according to Clark) that a deal would be impractical, for the former slave owners could not collect their ’emancipation ayments’ after abolition. Only a forceful change in property rights would end serfdom or slavery.
Clarks riposte to this is that slavery in the Roman empire and serfdom in medieval England, in fact, disappeared without a social struggle. So history shows that institutions respond to market forces and do not constrain them. Hence, according to Clark, bad institutions cannot explain poor economic performance. The trouble with Clarks riposte is that his counterexamples do not make his point. Slavery in the Roman empire “ended” in the second century. Previously, it had been a brutal system of extreme work, draconian punishments, and no family life.