Can profitable arbitrage opportunities in the raw cotton market explain Britain’s continued preference for mule spinning?
AbstractIn an influential article Saxonhouse and Wright argued that the quality of local cotton was the single most important factor in explaining national preferences for ring or mule spinning. For Britain, they argue that mills using more flexible mule spindles could exploit arbitrage opportunities between different types of cotton in the Liverpool market, reducing the incentives to adopt rings. We use newly assembled price data to show that such cost-reducing arbitrage opportunities were small. We argue instead that the primary determinants of Lancashire’s technological choice were demand factors, but that the availability of good raw cotton did determine technological choice in emerging cotton industries.
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Bibliographic InfoPaper provided by London School of Economics and Political Science, Department of Economic History in its series Economic History Working Papers with number 515.
Length: 23 pages
Date of creation: Nov 2002
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Find related papers by JEL classification:
- N0 - Economic History - - General
- O52 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Europe
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- Cox, Alonzo B., 1928. "Marketing American Cotton in England," Technical Bulletins 156323, United States Department of Agriculture, Economic Research Service.
- Gary R. Saxonhouse & Gavin Wright, 1984. "New Evidence on the Stubborn English Mule and the Cotton Industry, 1878-1920," Economic History Review, Economic History Society, vol. 37(4), pages 507-519, November.
- Tim Leunig, 2000.
"New answers to old questions: explaining the slow adoption of ring spinning in Lancashire, 1880-1913,"
Economic History Working Papers
22378, London School of Economics and Political Science, Department of Economic History.
- Leunig, Timothy, 2001. "NEW ANSWERS TO OLD QUESTIONS: EXPLAINING THE SLOW ADOPTION OF RING SPINNING IN LANCASHIRE, 1880 l913," The Journal of Economic History, Cambridge University Press, vol. 61(02), pages 439-466, June.
- Tim Leunig, 2001. "New answers to old questions : explaining the slow adoption of ring spinning in Lancashire, 1880-1913," LSE Research Online Documents on Economics 493, London School of Economics and Political Science, LSE Library.
- Lazonick, William, 1981. "Factor Costs and the Diffusion of Ring Spinning in Britain Prior to World War I," The Quarterly Journal of Economics, MIT Press, vol. 96(1), pages 89-109, February.
- Sandberg, Lars G, 1969. "American Rings and English Mules: The Role of Economic Rationality," The Quarterly Journal of Economics, MIT Press, vol. 83(1), pages 25-43, February.
- Gary Saxonhouse & Gavin Wright, 1987. "Stubborn mules and vertical integration: the disappearing constraint?," Economic History Review, Economic History Society, vol. 40(1), pages 87-94, 02.
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