Lecture notes

Full Lecture notes - Economic History (ECON0121)

0 purchase

Module
Economic History (ECON0121)

Institution
University College London (UCL)

Full 10 weeks of Economic History (ECON0121) lecture notes including tips for the mid-term essays. Using these notes, I scored 88% and 75% on the two essay assessments. I think these notes have been organised and condensed well enough to help other students revise efficiently for good results as...

[Show more]

Last document update: 3 months ago

Preview 4 out of 49 pages

View example

Uploaded on July 14, 2024
File latest updated on November 8, 2024
Number of pages 49
Written in 2023/2024
Type Lecture notes
Professor(s) Ramin nassehi
Contains All classes

economics
economic history
economic
history
industrialisation
demographic transition
capital accumulation
technological progress
structural change
political institution
ucl
state led industrialisation

ECON0121: Economic History
TABLE OF CONTENTS
1 Industrialisation Before 1870 ...............................................................................................................2
2 Industrialisation After 1870 .................................................................................................................7
3 Demographic Transition (19th and Mainly 20th Century)................................................................... 11
4 Capital Accumulation & Technological Progress (Why some countries industrialised and others got
left behind)................................................................................................................................................. 15
5 Structural Change .............................................................................................................................. 21
6 Reading Week ................................................................................................................................... 26
7 State-led Industrialisation ................................................................................................................. 26
8 Political Institutions ........................................................................................................................... 31
9 Income Inequality.............................................................................................................................. 36
10 Natural Resources ............................................................................................................................. 43
11 Support for Essay Writing.................................................................................................................. 48
12 Support for Final Coursework ........................................................................................................... 49

,1 INDUSTRIALISATION BEFORE 1870
Timeline:

Britain's Higher Higher
Enabled Cheaper Substitution of
Mercantilism / success in demand for innovation =
education and energy than energy for
Imperialism international labour = High New
training wages labour
trade wages technologies

When technology was first invented, it was only profitable to use in Britain, but eventually became
efficient enough to use abroad.

Lecture 1: The British Industrial Revolution

• When did rich countries become rich?
o Feudalism was born at the birth of agriculture 10,000 years ago.
o Merchant capitalism was around the 1500s.
o The Industrial Revolution started in the mid-1700s.
o GDP per person exploded around the 1900s.
• Merchant capitalism:
o International trade was the main activity.
o Birth of first corporations :
▪ Invisible technology – a way of pooling resources and risks together.
▪ E.g., banks (essentially working as a time machine for money), insurance, the
City of London.
o First wave of colonialism.
• Technological advancement:
o E.g., Traditional weaving → “Spinning Jenny” → Powered by engines (GPT)
o James Watt invented the steam engine in the early 18th century; but this did not fully
take off until the 19th century. It takes a long time for a GPT to take off.
▪ E.g., traditional ploughing → steam engine tractor (led to improvements in
labour productivity in agriculture).
▪ It also led to lower cost / higher quality of transportation via steam ships →
modernised trade.

What was the difference between the Industrial Revolution and all other technical advancements
happening before it?

• The Industrial Revolution led to the Scientific Revolution.
• Allowed for continuous improvement in technology – an accumulation of new technologies:
one technology output was the input for a new technology.
• This opened the door for systematic innovation.

Growth Accounting for Britain:

• Growth accounting: decomposing the economic growth of a country into the contribution of
increases in capital stock, labour input, and technological progress.

, •
o Capital grew – more machinery.
o Labour grew – more people working.
o GDP continued to grow.
o Residual = TFP growth – more innovation.
• Sources of Power (energy):
o Steam became a GPT a dominant source for power in 1870 across all sectors (50 years
after invention). Why?
▪ Technical infrastructure: there is a lag between invention, innovation, and
adoption (requires complementary technology).
• Making the steam engine cheaper and more applicable.
• Redesigning the ecosystem around
the steam engine (factory and
infrastructure).
▪ Political / Social infrastructure – people
may be more resistant to change.
o Redesigning the ecosystem:
▪ GPT = new technology.
▪ Factory/firm = require redesigning firms.
▪ Political / economic institutions = require
redesigning institutions to manage conflict
(soft/social infrastructure).

Distribution of Gains

• Both capital owners (entrepreneurs, etc) and labour grew over time.
• Landowners were the only losers.

Why did wages start to grow after 1860?

1. Economic factor: Surplus labour running out.

, a. As the economy continues to grow, the demand for labour starts to grow, the surplus
labour starts to shrink, leading to higher wages.
b. E.g., modern day China – labour left farms to work in cities. This led to surplus labour in
cities, depressing wages. As growth increased, a shrinking labour surplus has led to
higher wages.
2. Political factor: Rise of unions.
a. Trade unions were an institutional innovation.
b. Threat of revolution forces the elite to concede to the common folk.
3. Others:
a. Ownership of new skills made workers more valuable to owners (more of an impact –
higher wages → more spending on education → higher skilled workers).

Why did the Industrial Revolution end up producing more jobs?

• Income effect – the demand factor outpaced automation. So, the overall market grows.

Effects on the demand for labour:

1. Negative effect:
a. Displacement effect – jobs are destroyed.
2. Positive effect:
a. Composition effect (new tasks) – complementary tasks are created as technology
grows. E.g., engine engineers, factory cleaners, ticket checkers.
b. Productivity effect (spending effect) – cost of things goes down → more people buy it
→ you produce more (income effect).

Effect of automation in 𝑖 on aggregate labour demand = Productivity effect + Displacement effect +
Composition effect.

• Overall, the AI revolution will not reduce employment and wage growth because there is a
mismatch between the technological and physical world (our resource limit).

European “Followers” & the “Rest”

• The Followers (1815-1870) (through imitation and adoption):
o France
o Germany
o USA
• What happened to the rest?
o Colonialism (slavery, cotton plantations).
o Net exporter of raw materials (minerals, commodities).
o Net importer of industrial goods.

Why did the Industrial Revolution start in Britain?

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

You can quickly pay through credit card for the summaries. There is no membership needed.

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller jasminek1. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for £15.66. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

69252 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy revision notes and other study material for 15 years now

Start selling