Factor prices and induced technical change in the industrial revolution

Otojanov, Ravshonbek, Fouquet, Roger and Granville, Brigitte (2023) Factor prices and induced technical change in the industrial revolution. Economic History Review, 76 (2). 599 - 623. ISSN 0013-0117

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Abstract

Using historical data for the 1700–1914 period, this paper analyses the nature and direction of technical change in Britain. The evidence in this paper indicates that, over this long period, labour-saving technology adoption was a major response to changes in relative factor prices, thus supporting the hypothesis that ‘induced innovation’ was a major driver of technical change during the British industrial revolution. Labour saving was made possible and sustained by capital-augmenting and energy-augmenting technical change coupled with continuous capital accumulation and abundant energy supplies. This process placed the British economy on a higher capital–labour ratio equilibrium, and was the primary force driving sustained productivity growth, which further raised wages and living standards.

Item Type:	Article
Official URL:	https://onlinelibrary.wiley.com/journal/14680289
Additional Information:	© 2022 The Authors
Divisions:	Grantham Research Institute
Subjects:	H Social Sciences > HC Economic History and Conditions
JEL classification:	N - Economic History > N7 - Transport, International and Domestic Trade, Energy, Technology, and Other Services > N73 - Europe: Pre-1913
Date Deposited:	27 Apr 2022 15:27
Last Modified:	12 Dec 2024 02:59
URI:	http://eprints.lse.ac.uk/id/eprint/114978

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