A biophysical model of the industrial revolution

Date

2021

Authors

Kennedy, Christopher

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Abstract

Several biophysical characteristics underlay Britain’s Industrial Revolution: improvements in agricultural productivity; large increases in use of coal energy supply; and physical construction of infrastructure for industrialization and urbanization. These characteristics are represented in a four sector model of Britain’s economy (1760 to 1913) including: agriculture; mining; construction of capital; and the production of goods and services. The model has a novel mathematical representation of a dynamic general equilibrium between capital, labour and energy in an economy. Historical data is used to calibrate the model for growth of Britain’s capital stock, coal use and employment during the Industrial Revolution (first and second periods). Model simulations explore the impacts of two biophysical constraints: stagnation in agricultural productivity; and reduced efficiency in coal mining in the absence of steam engines. Both scenarios exhibit substantial reductions in the growth of capital stock and significant changes to the distribution of labour.

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Keywords

capital, energy, labour, endogenous growth, Great Britain, general equilibrium model, coal, construction, agriculture

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