Intro to Industrial revolution

Question 1

What happened to UK real incomes 1770-1860 after population tripled?

Answer 1

Increased ten fold from 1860

Question 2

In what sectors did productivity rise

Answer 2

Agriculture and industry

Question 3

How much did employment in agriculture shrink by 1861

Answer 3

21%

Question 4

How much did wealth inequality grow from Malthusian economies to modern economies

Answer 4

10x’s

Question 5

Where was the bulk of growth achieved?

Answer 5

gA

Question 6

When is capital stock optimised?

Answer 6

When increase in output per worker equals the real interest rate

Question 7

Why did efficiency gains grow capital stock?

Answer 7

It increased the marginal growth in output from a small increase in capital

Question 8

3 Main theories on why the IR happened

Answer 8

Exogenous growth (Institutions that lie outside of the economy)
Multiple equilibria  (Shock to economy caused leap to new path)
Endogenous growth (The economic structure made the IR inevitable)

Question 9

Exogenous growth

Answer 9

Argues that societies before 1800 poor at rewarding innovation and merit goods and institutions had to adapt e.g. removal of Christian laws

Question 10

2 Criticisms of Exogenous growth theories

Answer 10

Differences between post and pre-industrial institutions slight and patents only introduced after IR began

Question 11

Multiple equilibria

Answer 11

Bad equilibrium’s still had winners able to protect their gains, retention allowed for progress

Question 12

How did human capital change?

Answer 12

After the IR BR fell allowing greater investment into individual children

Question 13

Endogenous growth

Answer 13

Growth in population, and contact with international community led to rapid innovations
Geography of Eurasia also makes growth more likley