Mokyr, Joel, The Enlightened Economy: An Economic History of Britain 1700-1850
(2009), 564p.
Every generation rewrites history to reflect contemporary concerns. Mokyr’s
substantial study mirrors our fascination with information technology and sees ideas
expressed in technology as the “lever of riches” in the British and European industrial
revolution. This study is a comprehensive description of economic change and includes
all the major topics that one would expect—technology, trade, agriculture, transport,
mining, finance and credit, coinage, health and medicine, population, consumption, the
labor movement, productivity, capital accumulation, patents, gender and family structure,
poor relief, business and factory organization, political and economic institutions, social
norms, living standards, social structure, slavery and its abolition, the move from
protection to free trade, the growth of the national debt and taxation, the dramatic growth
of cities and social unrest, the creation of parliamentary government, the growth of output
in numerous sectors, and the development of new ones, such as railroads, steam power,
and gas lighting. The book is, however, much more than an up to date and excellent
description of all that changed during the period, and why we still call this the industrial
revolution even though it took place over a century and a half. It is also a major modern
reinterpretation. Although he discusses traditional explanations of the industrial
revolution, such as a favorable geography and easy access to natural resources, as well as
an effective government and the prior existence of a middle class that promoted
consumption, he insists that alongside these we must add the fundamental driving force
behind all these changes, which for Mokyr is the intellectual environment of the
Enlightenment.
During the last third of the 20th century, the periodization of the classic industrial
revolution, approximately between about 1770 and 1830, has been dethroned by
econometric research that showed economic growth was modest during this period.
Mokyr, whose academic appointment is in an economics department, and whose early
work owed a good deal to econometric research, accepts the lengthening of the period in
which we should place the industrial revolution took place to include the entire 18th
century. Most historians now agree that substantial economic growth did not occur until
after 1820, and its impact was not felt dramatically everywhere until the spread of the
railways in the 1840s. Thus, the main problem for economic historians of the industrial
revolution has become how to explain why the 18th century provided the preparation that
made the more dramatic and widespread changes of the early 19th century possible.
Mokyr argues that the key development was the Enlightenment’s fascination with “useful
knowledge.” He explains how a “Baconian program” of empirical research expanded
scientific knowledge, applied knowledge to practical problems, and then its diffusion that
spread it throughout society.
Along with many other writers on the origin of the industrial revolution in Britain,
he emphasizes that the consequences of the Revolution of 1688 made property more
secure and established a stable and effective form of government that encouraged
scientific experimentation, free communication, and a relatively open form of
government, all of which encouraged the private pursuit of wealth. It established patent
law and intellectual property rights, which seeded further innovation. From an economic
perspective, better government was important in limiting the ability of “rent seekers” --an
economist’s euphemism for predators, pirates and parasites, and including many
monarchs, aristocrats and foreign invaders--to inhibit economic growth. In 18th century
Britain, the rent seeking activities of monopolists, combinations and restrictive
regulations, which later was called “mercantilism,” came under attack and were gradually
replaced with what came to be called “economic liberty” and resulted in free trade and a
relatively laissez faire government friendly to business interests by the early Victorian
period. For Mokyr, however, having the ‘right’ institutions was not sufficient for
sustained economic growth.
Mokyr argues that most economic historians, including free market economists,
share Marx’s materialist view that beliefs adjust themselves to economic interests, which
themselves are essentially consequences of deeper forces, such as technology,
demography, geography and other materialist forces. Others argue that ideas determine
history. Mokyr insists that in reality the two forces work together in complex ways and,
under the right circumstances, such as in 18th century Britain, this produces a “positive
feedback loop” that was able to create the industrial revolution in Britain. His argument is
not deterministic. Ultimately, he sees the British industrial revolution as contingent upon
a fortuitous confluence of events. He notes that it is often argued that policy makers and
rulers determine historical development, “but in the Industrial revolution the beliefs of
intellectuals, scientists and skilled mechanics, inventors and entrepreneurs may have
mattered more.” Mokyr explains that economic growth, such as it was, before the mid-18
the century was what we now call, after Adam Smith who described it, “Smithian
growth,” chiefly consisting of the expansion of commerce, the growth of markets, and
improvements in the allocation of resources. These economic gains were largely due to
specialization and the division of labor. Such improvements were often also associated
with industrial and technological improvements, but before the industrial revolution
progress was primarily driven by institutional improvements and commerce. Its chief
early beneficiaries were northern Italy, the Low Countries, southern Germany and
England. What distinguished the Industrial revolution, according to Mokyr, was that it
“placed technology as the main engine of economic change.” He acknowledges that 18th
century entrepreneurs did not build directly upon great scientific breakthroughs or even
dramatic technological advances, but many in business furthered what was often
incremental “useful knowledge” out of their own curiosity and encouraged institutions
that spread intellectual and technological innovations to a wider educated public. He
explains that many of the “wave of gadgets,” which we associate with the classical
industrial revolution, could have been achieved with the knowledge available around
1600. Much of the technological innovation that Mokyr discusses in detail in many
sectors of the economy were not a result of what we would describe as science, but as
useful knowledge and innovation. However, the relative importance of science to the
productive economy kept growing during the late 18th century and became indispensable
by the period of the second industrial revolution during the 1870s.
In an earlier study, The Gift of Athena: The Historical Origin of the Knowledge
Economy (2002), Mokyr explained that the Enlightenment was a European phenomenon
and that this was a key factor in the “great divergence,” or why Europe rather than Asia,
had the first industrial revolution, but it does not explain why Britain, as opposed to the
Dutch Republic or France, had the first industrial revolution. In The Enlightened
Economy he makes the case of why the first industrial revolution took place in Britain,
but also suggests that different circumstances might have produced the first industrial
revolution on the continent. He describes “Britain’s position as the lead car in the
Occident Express that gathered steam in the nineteenth century and drove away from the
rest of the world,” but then admits that his explanation does not fully explain the source
of the locomotive’s power. Mokyr’s study is at its best when he explains the linkage
between ideas, invention, and the role of technology in slowly, unevenly, and in fits and
starts laid the groundwork for the industrial revolution. His book pays much less attention
to how the workers experienced industrialization or to the growth of class conflict and
social unrest. He does argue that the standard of living and the quality of life for the
common people before 1850 supports a moderately pessimistic interpretation. Critics
have argued that Mokyr’s book is another example of Western triumphalism and an
ultimately unproven assertion of the triumph of ideas and a hymn to Western
exceptionalism in science and technology. Mokyr, however, is very aware of this
criticism and has provided a learned, masterful and well-written analysis with fascinating
detail that provides a persuasive modern argument for his thesis.