This is the title of the new book by Professor Robert Allen of Nuffield College, Oxford, and a fascinating assessment it is of the progress of industrial development in Britain compared to other leading economies of the 18th and 19th centuries. One of the fundamental questions of course is why Britain? And why the late 18th century? As Prof Allen notes, there have been many kinds of explanation – cultural, sociological, technological. Not surprisingly, the economic historian turns to a different set of explanatory variables.

His hypothesis in The British Indutrial Revolution in Global Perspective is that relative factor endowments played into a context of slowly but steadily rising consumer demand. In the preceding hundred years or so literacy rates had risen, consumerism was on the march, a growing urban population wanted to buy new goods (books, clocks) and imported luxuries (sugar, tea). Allen writes: “In England, the proportion of the population who could sign their name rose from about 6% in 1500 to 53% in 1800. A reading public of this size was unprecedented in world history and led to new ways of thinking in many areas.” (p12).

The upshot was that wage rates in Britain were relatively high by the end of the 18th century, while extensive coal reserves meant than energy was relatively cheap. These relative endowments and factor costs stimulated capital investment and innovation in Britain, whereas in other leading countries innovation and investment were not profitable. (And the book does refer to Britain's position vis a vis China as well as other western economies.)

History is over-determined and so of course cultural and social factors played a part too, along with the co-evolution of technological innovation with the financial and legal framework that rewarded it. Still, I find the factor cost explanation wonderfully elegant and persuasive. There is ample evidence in many contexts that the profitability of existing methods of production can indeed inhibit the adoption of new technical (or managerial) innovations. And of course this fascinating book documents the evidence thoroughly for the era and technologies of the Industrial Revolution. This includes for example cost breakdowns for cotton manufacture and comparative real energy prices in London, Antwerp and Canton. Great stuff – I was much teased by my husband for calling out 'What a great table!' as I read this.

I particularly enjoyed the chapter on the interaction between human capital and the adoption of the innovations, the links between the Enlightenment, the Scientific Revolution and the industrial application of knowledge through entrepreneurship. Allen looks at the individual inventors and their connections with scientific research – one of the interesting aspects is how widespead the array of invention was, not just steam and cotton and coal but also ceramics, chemicals, instrumentation and machine tools. These had geographical specificity too – although some of these such as metals (West Country Quakers) and textiles (Manchester men of action) had the fewest connections with the leading edge scientific world. This material complements the lovely Lunar Men by Jenny Uglow and another recent cultural history of the period of scientific discovery by Richard Holmes, The Age of Wonder.

Anyway, I'm an Industrial Revolution and Enlightenment groupie, but even allowing for that, Professor Allen's book is a must-read for anyone interested in economic history and the long-term trajectory of Britain's role in the world. It makes an important contribution to the scholarly debate about long-term comparative economic performance.

On another note, this will be my last post for the next week as I'm off on holiday, leaving behind laptop and dongle.