British Industrial Revolution Analysis

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The British Industrial revolution (ca. 1780) was the result of an economic expansion which took place at the beginning of the sixteenth century and was achievable thanks to many distinct factors, such as Britain’s geographical position and culture. But were institutions an additional important element that affected the start and outcome of the British Industrial Revolution? Were all of these elements correlated? The role of institutions is a subject that continues to stir much debate; considering for example Acemoglu’s point of view in “Institutions as a fundamental cause of long-run growth” and Allen’s view in “Why industrial revolution was British” we notice how different opinions can be on what actually initiated the Industrial Revolution.…show more content…
In fact, good institutions, provide security for property rights and relatively equal access to economic resources to a broad-cross section of society. When analyzing Britain’s Industrial Revolution, a specific focus goes to the view of Mr North and Mr Weingast of the Glorious Revolution (1688) as an important foundation for creating a pluralistic society, and it built on and accelerated a process of political centralization. The formal political institutions, established in late Stuart and Williamite Britain, relied on the notion of credible commitment: this view shows that relocating the power to determine economic institutions to Parliament, rather than to the King, encouraged the British government to commit to repaying national debt and respecting the property of its citizens. This increased the de facto power of citizens, providing incentives for trade, investment and innovation which contributed to the enforcement of property rights, which furthermore heightened the stimulus for the adoption of efficient technologies and stimulated a more varied allocation of…show more content…
More generally, this definition encompasses the definition most widely used in economics, which states that institutions are a combination of formal and informal rules, together with their enforcement mechanisms. In other words, such institutions are endogenous: i.e. their form and their functioning depends on the conditions under which they emerge and endure. This statement helps us to understand the possibility of an important connection between Britain’s culture and its institutional factors, since they both depend on each other and both may vary with a change of the other. An important period of history, which led to a change in institutions prior to Britain’s Industrial Revolution, is the European Enlightenment which started at the beginning of the eighteenth century and was based on a new and developed “belief in the possibility and desirability of human progress and perfectibility though reason and knowledge”, which was later further incorporated into social and political ideas of rational reform. The fundamental assumption of this period was that the expansion of knowledge would later bring to prosperity and according to Mokyr “most inventions and innovations have depended on the culture of the technological community and its culture”. The Enlightenment was a time of many changes and discoveries; from the
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