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Technology, Growth Theory, and the First Industrial Revolution

Year 2021, Volume: 10 Issue: 1, 1 - 21, 15.01.2021

M. Aykut Attar

Abstract

In the 21st century, growth theorists have ambitiously extended the limits of what need to be understood into preindustrial times without renouncing sound microeconomic foundations, and growth theory has become irreversibly historical. This paper argues that much progress could be achieved if the frontier of growth theory is extended with a richer understanding of ideas, knowledge, and technology. The paper first defends the strong relevance of second-generation Schumpeterian models to the first Industrial Revolution. It then presents an evaluation of Mokyr’s (2002) non-mathematical theory of useful knowledge by identifying the main postulates of this theory that may illuminate Schumpeterian models of the first Industrial Revolution. The paper concludes with a discussion of three methodological obstacles that prevent immediate progress in this trajectory of inquiry.

Keywords

Unified Growth Theory economic history Schumpeterian growth useful knowledge endogenous technology

Supporting Institution

none

Project Number

none

Thanks

This paper has been presented at the 2018 workshop of the Turkish Initiative for Economic Thought on “Economics and History.” I am grateful to Derya Güler Aydın, Hüseyin Özel, and other members of the Initiative for their helpful comments and suggestions. The paper has also been presented at the 2020 Econ-Turkey Conference. I wish to thank the conference participants for their valuable feedback. Finally, I wish to thank Sencer Karademir who has provided excellent research assistance. All of the remaining errors are of my own.

References

  • Ang J. B. & Madsen J. B. (2011). Can Second-Generation Endogenous Growth Models Explain the Productivity Trends in the Asian Miracle Economies?. Review of Economics and Statistics, 93, 1360–73.
  • Attar M. A. (2015). Entrepreneurship, Knowledge, and the Industrial Revolution. Economics: The Open-Access, Open-Assessment E-Journal, 9, 1–54.
  • Clark, G. (2014). The Industrial Revolution. In: P. Aghion & S. Durlauf (Eds.), Handbook of Economic Growth Vol 2, (pp. 217–262), Amsterdam: Elsevier.
  • Clark, G. (2016). The Industrial Revolution: A Cliometric Perspective. In: C. Diebolt & M. Haupert (Eds.), Handbook of Cliometrics, (pp. 197–235), Heidelberg: Springer.
  • Dasgupta, P, & David, P. A. (1994). Toward a new economics of science. Research Policy, 23, 487–521.
  • De la Croix, D., Doepke, M., & Mokyr, J. (2018). Clans, Guilds, and Markets: Apprenticeship Institutions and Growth in the Preindustrial Economy. Quarterly Journal of Economics, 133, 1–70.
  • De Meulemeester, J. & Diebolt, C. (2007). How much could economics gain from history: the contribution of cliometrics. Cliometrica, 1, 7–17.
  • Desmet, K. & Parente, S. L. (2012). The evolution of markets and the revolution of industry: a unified theory of growth. Journal of Economic Growth, 17, 205–234.
  • Diebolt, C. (2012). The cliometric voice. History of Economic Ideas, 20, 51–64.
  • Diebolt, C. & Haupert, M. (2016). An Introduction to the Handbook of Cliometrics. In: C. Diebolt & M. Haupert (Eds.), Handbook of Cliometrics, (pp. v–xiv), Heidelberg: Springer.
  • Diebolt, C. & Perrin, F. (2016). Growth theories. In: C. Diebolt & M. Haupert (Eds.), Handbook of Cliometrics, (pp. 175–95), Heidelberg: Springer.
  • Dinopoulos, E. & Thompson, P. 1998, “Schumpeterian Growth without Scale Effects”, Journal of Economic Growth, 3, 313–335.
  • Durlauf, S. N. & Quah, D. T. (1999). The New Empirics of Economic Growth. In: J. Taylor & M. Woodford (Eds.), Handbook of Macroeconomics Vol. 1A, (pp. 235–310), Amsterdam: North-Holland.
  • Dutton, H. I. (1984). The Patent System and Inventive Activity During the Industrial Revolution, 1750–1852, Manchester: Manchester University Press.
  • Foray, D. (2004). Economics of Knowledge. Cambridge, MA: MIT Press.
  • Galor, O. (2005). From Stagnation to Growth: Unified Growth Theory. In: P. Aghion & S. Durlauf (Eds.), Handbook of Economic Growth, Vol. 1A, (pp. 171–293), Amsterdam: Elsevier.
  • Galor, O. 2011, Unified Growth Theory, Princeton, NJ: Princeton University Press.
  • Galor, O. & Weil, D. N. (2000). Population, Technology, and Growth: From Malthusian Stagnation to the Demographic Transition and Beyond. American Economic Review, 90, 806–828.
  • Growiec, J. (2007). Beyond the Linearity Critique: The Knife-edge Assumption of Steady-State Growth. Economic Theory, 31, 489–499.
  • Howitt, P. (1999). Steady Endogenous Growth with Population and R & D Inputs Growing. Journal of Political Economy, 107, 715–730.
  • Islam, N. (2003). What Have We Learnt from the Convergence Debate?. Journal of Economic Surveys, 17, 309–362.
  • Jones, C. I. (1995). R&D-Based Models of Economic Growth. Journal of Political Economy, 103, 759–784.
  • Laincz, C. A. & Peretto, P. F. (2006). Scale effects in endogenous growth theory: an error of aggregation not specification. Journal of Economic Growth, 11, 263–288.
  • Landes, D. S. (1969). The Unbound Prometheus: Technological Change and Industrial Development in Western Europe from 1750 to the Present. Cambridge, MA: Cambridge University Press.
  • Lucas, R. E. (2002). The Industrial Revolution: Past and Future. In: R. E. Lucas (Ed.), Lectures on Economic Growth, (pp. 109–188), Cambridge, MA: Harvard University Press.
  • Lucas, R. E. (2009). Trade and the Diffusion of the Industrial Revolution. American Economic Journal: Macroeconomics, 1, 1–25.
  • MacLeod, C. (1988). Inventing the Industrial Revolution: The English Patent System, 1660–1880, Cambridge: Cambridge University Press.
  • Madsen, J. B. (2008). Semi-endogenous versus Schumpeterian growth models: testing the knowledge production function using international data. Journal of Economic Growth, 13, 1–26.
  • Madsen, J. B., Ang, J. B. & Banerjee, R. (2010). Four Centuries of British Economic Growth: The Roles of Technology and Population. Journal of Economic Growth, 15, 263–290.
  • Madsen, J. B. & Murtin, F. (2017). British economic growth since 1270: the role of education. Journal of Economic Growth, 22, 229–272.
  • Merton, R. K. (1961). Singletons and Multiples in Scientific Discovery: A Chapter in the Sociology of Science. Proceedings of the American Philosophical Society, 105, 470–486.
  • Merton, R. K. (1973). The Sociology of Science: Theoretical and Empirical Investigations. Chicago: University of Chicago Press.
  • Milionis, P. & Klasing, M. (2009). Innovation-Based Growth & Long-Run Economic Development. (Unpublished Manuscript).
  • Mokyr, J. (2002). The Gifts of Athena: Historical Origins of the Knowledge Economy. Princeton, NJ: Princeton University Press.
  • Mokyr, J. (2008). The Institutional Origins of the Industrial Revolution: Past and Future. In: E. Helpman (Ed.), Institutions and Economic Performance, (pp. 64–119), Cambridge, MA: Harvard University Press.
  • Olsson, O. (2000). Knowledge as a Set in Idea Space: An Epistemological View on Growth. Journal of Economic Growth, 5, 253–275.
  • Olsson, O. (2005). Technological Opportunity and Growth. Journal of Economic Growth, 10, 35–57.
  • O’Rourke, K. H., Rahman, A. S. & Taylor A. M. (2013). Luddites, the industrial revolution, and the demographic transition. Journal of Economic Growth, 18, 373–409.
  • Peretto, P. F. (1998a). Technological Change and Population Growth. Journal of Economic Growth, 3, 283–311.
  • Peretto, P. F. (1998b). Technological Change, Market Rivalry, and the Evolution of the Capitalist Engine of Growth. Journal of Economic Growth, 3, 53–80.
  • Peretto, P. F. (2015). From Smith to Schumpeter: A theory of take-off and convergence to sustained growth. European Economic Review, 78, 1–26.
  • Peretto, P. F. (2018). Robust Endogenous Growth. European Economic Review, 108, 49–77.
  • Perrin, F. (2011). Unified Growth Theory: An Insight. Historical Social Research, 36, 362–372.
  • Romer, P. M. (1996). Why, Indeed, in America? Theory, History, and the Origins of Modern Economic Growth. American Economic Review, 86, 202–206.
  • Rosenberg, N. (1974). Science, Invention and Economic Growth. Economic Journal, 84, 90–108.
  • Schmookler, J. (1966). Invention and Economic Growth. Cambridge, MA: Harvard University Press.
  • Schumpeter, J. A. (1947). The Creative Response in Economic History. Journal of Economic History, 7, 149–159.
  • Solo, C. S. (1951). Innovation in the Capitalist Process: A Critique of the Schumpeterian Theory. Quarterly Journal of Economics, 65, 417–428.
  • Strulik, H. (2014). Knowledge and Growth in The Very Long Run. International Economic Review, 55, 459–482.
  • Sullivan, R. J. (1989). England's ‘Age of Invention’: the acceleration of patents and patentable invention during the Industrial Revolution. Explorations in Economic History, 26, 424–452.
  • Sullivan, R. J. (1990). The Revolution of Ideas: Widespread Patenting and Invention During the English Industrial Revolution. Journal of Economic History, 50, 349–362.
  • Venturini, F. (2012). Product variety, product quality, and evidence of endogenous growth. Economics Letters, 117, 74–77.
  • Weitzman, M. L. (1998). Recombinant Growth. Quarterly Journal of Economics, 113, 331–360.
  • Young, A. (1998) Growth without Scale Effects. Journal of Political Economy, 106, 41–63.

Teknoloji, Büyüme Kuramı ve Birinci Sanayi Devrimi

Year 2021, Volume: 10 Issue: 1, 1 - 21, 15.01.2021

M. Aykut Attar

Abstract

21. yüzyılda büyüme kuramcıları, anlaşılması gerekenlerin sınırlarını iddialı biçimde ve sağlam mikroekonomik temellerden feragat etmeksizin, sanayi-öncesi zamanlara doğru genişlettiler ve büyüme kuramı geri dönülmez biçimde tarihselleşti. Bu makale, eğer büyüme kuramının sınırı, düşünce, bilgi ve teknolojinin daha zengin bir anlayışı ile genişletilirse çok daha fazla ilerlemenin sağlanabileceğini öne sürüyor. Makale, önce, ikinci-nesil Schumpeter-gil modellerin Birinci Sanayi Devrimi için olan uygunluğunu savunuyor. Ardından, Mokyr’ın (2002) matematiksel olmayan faydalı bilgi kuramının bir değerlendirmesini, bu kuramın Birinci Sanayi Devrimi’nin Schumpeter-gil modellerini aydınlatabilecek önermelerini belirleyerek sunuyor. Makale, bu araştırma çizgisindeki hızlı ilerlemenin önüne geçen üç yöntembilimsel engele ilişkin bir tartışmayla son buluyor.

Keywords

Birleştirilmiş Büyüme Kuramı iktisadi tarih Schumpeter-gil büyüme faydalı bilgi içsel teknoloji

Project Number

none

References

  • Ang J. B. & Madsen J. B. (2011). Can Second-Generation Endogenous Growth Models Explain the Productivity Trends in the Asian Miracle Economies?. Review of Economics and Statistics, 93, 1360–73.
  • Attar M. A. (2015). Entrepreneurship, Knowledge, and the Industrial Revolution. Economics: The Open-Access, Open-Assessment E-Journal, 9, 1–54.
  • Clark, G. (2014). The Industrial Revolution. In: P. Aghion & S. Durlauf (Eds.), Handbook of Economic Growth Vol 2, (pp. 217–262), Amsterdam: Elsevier.
  • Clark, G. (2016). The Industrial Revolution: A Cliometric Perspective. In: C. Diebolt & M. Haupert (Eds.), Handbook of Cliometrics, (pp. 197–235), Heidelberg: Springer.
  • Dasgupta, P, & David, P. A. (1994). Toward a new economics of science. Research Policy, 23, 487–521.
  • De la Croix, D., Doepke, M., & Mokyr, J. (2018). Clans, Guilds, and Markets: Apprenticeship Institutions and Growth in the Preindustrial Economy. Quarterly Journal of Economics, 133, 1–70.
  • De Meulemeester, J. & Diebolt, C. (2007). How much could economics gain from history: the contribution of cliometrics. Cliometrica, 1, 7–17.
  • Desmet, K. & Parente, S. L. (2012). The evolution of markets and the revolution of industry: a unified theory of growth. Journal of Economic Growth, 17, 205–234.
  • Diebolt, C. (2012). The cliometric voice. History of Economic Ideas, 20, 51–64.
  • Diebolt, C. & Haupert, M. (2016). An Introduction to the Handbook of Cliometrics. In: C. Diebolt & M. Haupert (Eds.), Handbook of Cliometrics, (pp. v–xiv), Heidelberg: Springer.
  • Diebolt, C. & Perrin, F. (2016). Growth theories. In: C. Diebolt & M. Haupert (Eds.), Handbook of Cliometrics, (pp. 175–95), Heidelberg: Springer.
  • Dinopoulos, E. & Thompson, P. 1998, “Schumpeterian Growth without Scale Effects”, Journal of Economic Growth, 3, 313–335.
  • Durlauf, S. N. & Quah, D. T. (1999). The New Empirics of Economic Growth. In: J. Taylor & M. Woodford (Eds.), Handbook of Macroeconomics Vol. 1A, (pp. 235–310), Amsterdam: North-Holland.
  • Dutton, H. I. (1984). The Patent System and Inventive Activity During the Industrial Revolution, 1750–1852, Manchester: Manchester University Press.
  • Foray, D. (2004). Economics of Knowledge. Cambridge, MA: MIT Press.
  • Galor, O. (2005). From Stagnation to Growth: Unified Growth Theory. In: P. Aghion & S. Durlauf (Eds.), Handbook of Economic Growth, Vol. 1A, (pp. 171–293), Amsterdam: Elsevier.
  • Galor, O. 2011, Unified Growth Theory, Princeton, NJ: Princeton University Press.
  • Galor, O. & Weil, D. N. (2000). Population, Technology, and Growth: From Malthusian Stagnation to the Demographic Transition and Beyond. American Economic Review, 90, 806–828.
  • Growiec, J. (2007). Beyond the Linearity Critique: The Knife-edge Assumption of Steady-State Growth. Economic Theory, 31, 489–499.
  • Howitt, P. (1999). Steady Endogenous Growth with Population and R & D Inputs Growing. Journal of Political Economy, 107, 715–730.
  • Islam, N. (2003). What Have We Learnt from the Convergence Debate?. Journal of Economic Surveys, 17, 309–362.
  • Jones, C. I. (1995). R&D-Based Models of Economic Growth. Journal of Political Economy, 103, 759–784.
  • Laincz, C. A. & Peretto, P. F. (2006). Scale effects in endogenous growth theory: an error of aggregation not specification. Journal of Economic Growth, 11, 263–288.
  • Landes, D. S. (1969). The Unbound Prometheus: Technological Change and Industrial Development in Western Europe from 1750 to the Present. Cambridge, MA: Cambridge University Press.
  • Lucas, R. E. (2002). The Industrial Revolution: Past and Future. In: R. E. Lucas (Ed.), Lectures on Economic Growth, (pp. 109–188), Cambridge, MA: Harvard University Press.
  • Lucas, R. E. (2009). Trade and the Diffusion of the Industrial Revolution. American Economic Journal: Macroeconomics, 1, 1–25.
  • MacLeod, C. (1988). Inventing the Industrial Revolution: The English Patent System, 1660–1880, Cambridge: Cambridge University Press.
  • Madsen, J. B. (2008). Semi-endogenous versus Schumpeterian growth models: testing the knowledge production function using international data. Journal of Economic Growth, 13, 1–26.
  • Madsen, J. B., Ang, J. B. & Banerjee, R. (2010). Four Centuries of British Economic Growth: The Roles of Technology and Population. Journal of Economic Growth, 15, 263–290.
  • Madsen, J. B. & Murtin, F. (2017). British economic growth since 1270: the role of education. Journal of Economic Growth, 22, 229–272.
  • Merton, R. K. (1961). Singletons and Multiples in Scientific Discovery: A Chapter in the Sociology of Science. Proceedings of the American Philosophical Society, 105, 470–486.
  • Merton, R. K. (1973). The Sociology of Science: Theoretical and Empirical Investigations. Chicago: University of Chicago Press.
  • Milionis, P. & Klasing, M. (2009). Innovation-Based Growth & Long-Run Economic Development. (Unpublished Manuscript).
  • Mokyr, J. (2002). The Gifts of Athena: Historical Origins of the Knowledge Economy. Princeton, NJ: Princeton University Press.
  • Mokyr, J. (2008). The Institutional Origins of the Industrial Revolution: Past and Future. In: E. Helpman (Ed.), Institutions and Economic Performance, (pp. 64–119), Cambridge, MA: Harvard University Press.
  • Olsson, O. (2000). Knowledge as a Set in Idea Space: An Epistemological View on Growth. Journal of Economic Growth, 5, 253–275.
  • Olsson, O. (2005). Technological Opportunity and Growth. Journal of Economic Growth, 10, 35–57.
  • O’Rourke, K. H., Rahman, A. S. & Taylor A. M. (2013). Luddites, the industrial revolution, and the demographic transition. Journal of Economic Growth, 18, 373–409.
  • Peretto, P. F. (1998a). Technological Change and Population Growth. Journal of Economic Growth, 3, 283–311.
  • Peretto, P. F. (1998b). Technological Change, Market Rivalry, and the Evolution of the Capitalist Engine of Growth. Journal of Economic Growth, 3, 53–80.
  • Peretto, P. F. (2015). From Smith to Schumpeter: A theory of take-off and convergence to sustained growth. European Economic Review, 78, 1–26.
  • Peretto, P. F. (2018). Robust Endogenous Growth. European Economic Review, 108, 49–77.
  • Perrin, F. (2011). Unified Growth Theory: An Insight. Historical Social Research, 36, 362–372.
  • Romer, P. M. (1996). Why, Indeed, in America? Theory, History, and the Origins of Modern Economic Growth. American Economic Review, 86, 202–206.
  • Rosenberg, N. (1974). Science, Invention and Economic Growth. Economic Journal, 84, 90–108.
  • Schmookler, J. (1966). Invention and Economic Growth. Cambridge, MA: Harvard University Press.
  • Schumpeter, J. A. (1947). The Creative Response in Economic History. Journal of Economic History, 7, 149–159.
  • Solo, C. S. (1951). Innovation in the Capitalist Process: A Critique of the Schumpeterian Theory. Quarterly Journal of Economics, 65, 417–428.
  • Strulik, H. (2014). Knowledge and Growth in The Very Long Run. International Economic Review, 55, 459–482.
  • Sullivan, R. J. (1989). England's ‘Age of Invention’: the acceleration of patents and patentable invention during the Industrial Revolution. Explorations in Economic History, 26, 424–452.
  • Sullivan, R. J. (1990). The Revolution of Ideas: Widespread Patenting and Invention During the English Industrial Revolution. Journal of Economic History, 50, 349–362.
  • Venturini, F. (2012). Product variety, product quality, and evidence of endogenous growth. Economics Letters, 117, 74–77.
  • Weitzman, M. L. (1998). Recombinant Growth. Quarterly Journal of Economics, 113, 331–360.
  • Young, A. (1998) Growth without Scale Effects. Journal of Political Economy, 106, 41–63.
There are 54 citations in total.

Details

Primary Language English
Subjects Economics
Journal Section Research Articles
Authors

M. Aykut Attar 0000-0003-0142-713X

Project Number none
Publication Date January 15, 2021
Published in Issue Year 2021 Volume: 10 Issue: 1

Cite

APA Attar, M. A. (2021). Technology, Growth Theory, and the First Industrial Revolution. Ekonomi-Tek, 10(1), 1-21.
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