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Coal Smoke and the Costs of the Industrial Revolution

Listed author(s):
  • W. Walker Hanlon

While the Industrial Revolution brought economic growth, there is a long debate in economics over the costs of the pollution externalities that accompanied early industrialization. To help settle this debate, this paper introduces a new theoretically-grounded strategy for estimating the impact of industrial pollution on local economic development and applies this approach to data from British cities for 1851-1911. I show that local industrial coal use substantially reduced long-run city employment growth over this period. Moreover, a counterfactual analysis suggests that plausible improvements in coal use efficiency would have led to substantially higher urbanization rates in Britain by 1911.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 22921.

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Date of creation: Dec 2016
Handle: RePEc:nbr:nberwo:22921
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