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The growing dependence of Britain on trade during the Industrial Revolution

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  • Gregory Clark
  • Kevin Hjortsh�j O'Rourke
  • Alan M. Taylor

Abstract

Many previous studies of the role of trade during the British Industrial Revolution have found little or no role for trade in explaining British living standards or growth rates. We construct a three-region model of the world in which Britain trades with North America and the Rest of the World, and calibrate the model to data from the 1760s and 1850s. We find that while trade had only a small impact on British welfare in the 1760s, it had a very large impact in the 1850s. This contrast is robust to a large range of parameter perturbations. Biased technological change and population growth were key in explaining Britain's growing dependence on trade during the Industrial Revolution.

Suggested Citation

  • Gregory Clark & Kevin Hjortsh�j O'Rourke & Alan M. Taylor, 2014. "The growing dependence of Britain on trade during the Industrial Revolution," Scandinavian Economic History Review, Taylor & Francis Journals, vol. 62(2), pages 109-136, June.
  • Handle: RePEc:taf:sehrxx:v:62:y:2014:i:2:p:109-136
    DOI: 10.1080/03585522.2014.896285
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    References listed on IDEAS

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    1. Gregory Clark, 2005. "The Condition of the Working Class in England, 1209-2004," Journal of Political Economy, University of Chicago Press, vol. 113(6), pages 1307-1340, December.
    2. Ronald Findlay & Kevin H. O'Rourke, 2007. "Power and Plenty: Trade, War and the World Economy in the Second Millennium (Preface)," Trinity Economics Papers tep0107, Trinity College Dublin, Department of Economics.
    3. Gregory Clark, 2005. "The Condition of the Working Class in England, 1209-2004," Journal of Political Economy, University of Chicago Press, vol. 113(6), pages 1307-1340, December.
    4. Harley, C. Knick & Crafts, N.F.R., 2000. "Simulating the Two Views of the British Industrial Revolution," The Journal of Economic History, Cambridge University Press, vol. 60(3), pages 819-841, September.
    5. Mokyr, Joel, 1977. "Demand vs. Supply in the Industrial Revolution," The Journal of Economic History, Cambridge University Press, vol. 37(4), pages 981-1008, December.
    6. Allen,Robert C., 2009. "The British Industrial Revolution in Global Perspective," Cambridge Books, Cambridge University Press, number 9780521868273.
    7. Ronald Findlay & Kevin H. O'Rourke, 2007. "Introduction to Power and Plenty: Trade, War, and the World Economy in the Second Millennium," Introductory Chapters, in: Power and Plenty: Trade, War, and the World Economy in the Second Millennium, Princeton University Press.
    8. Clark, Gregory & Jacks, David, 2007. "Coal and the Industrial Revolution, 1700–1869," European Review of Economic History, Cambridge University Press, vol. 11(1), pages 39-72, April.
    9. Ronald Findlay & Kevin H. O'Rourke, 2007. "Preface to Power and Plenty: Trade, War, and the World Economy in the Second Millennium," Introductory Chapters, in: Power and Plenty: Trade, War, and the World Economy in the Second Millennium, Princeton University Press.
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    More about this item

    JEL classification:

    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • N10 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - General, International, or Comparative
    • N70 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - General, International, or Comparative
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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