The Enlightened Economy: An Economic History of Britain 1700-1850 (review)

This monumental work is essential reading for all historians of the eighteenth and nineteenth centuries, for it not only effectively tells the story of the Industrial Revolution—from first conception to early adulthood—but also integrates into that oft-told tale the very latest research while generously pointing to future research areas. It will also be of great interest to general readers and academics in other fields. It is written in a clear and readable prose style, avoids the economic jargon that non-economists find so off-putting, and contains valuable insights into present-day events, such as the rise of globalisation, the development strategies of emerging nations, the possible consequences of our own technological and knowledge revolution, and the liberal West's current fascination with illiberal regulation.

Essentially, this is a book about ideas: how they develop and the impact they have on every aspect of our lives. Joel Mokyr's main thesis is that the economic and social change of the late eighteenth and early nineteenth centuries can be traced back to the natural philosophy of the Enlightenment. He demonstrates how Enlightenment ideas intended to lead to moral improvement were embraced by a relatively small elite who transformed them into the technology that powered economic expansion; this, in turn, generated further intellectual knowledge. The ideas and technology then spread across Europe, North America, and Asia.

Mokyr identifies three factors essential to the success of this process. First, the evolution of existing political, economic, and social institutions into organisations that promoted growth and were themselves the product of new enlightened ideas, with great importance being laid on the development of provincial scientific societies. Second, the existence of human capital in the form of a cohort of entrepreneurs who had an interest in the new scientific ideas, were active members of such societies, and possessed the technical skills and capital necessary to transform theoretical knowledge into the goods and services needed and desired in Britain and later in the wider world. And finally, social capital, the trust relationships and informal networks that bound these individuals and institutions together and facilitated the diffusion of theoretical and practical knowledge.

After describing the genesis of industrial growth, Mokyr fleshes out the story by investigating the development and interconnection of various economic sectors—industry, agriculture, finance, and services. He places particular emphasis on the role of the state and its social contract with the British people and how the Enlightenment's hostility toward rent-seeking, that mercantilist policy of monopoly and privilege, contributed to the weakening of the guild system, the rise of domestic free trade, the creation of muscular property, intellectual property rights, and internal peace. All contributed to an environment in which the emerging new economy could thrive. He also questions some long-held beliefs, pointing out that the rate of economic growth was relatively low by present-day standards, that relatively few industries were mechanised, and that technological innovation often involved minor changes to existing machinery and equipment. These chapters, based on both secondary and primary material, contain a wealth of detail and acknowledge other factors that contributed to growth (favourable location, mineral resources, a pre-existing middle class), but continuously relate change to intellectual advances.

Mokyr then proceeds to explore the impact economic growth had on social change, family life, and well-being, linking the horrors of poverty, child labour, and often nonexistent sanitation to industrial growth and the enlightened mind. Although the new economy worsened rather than ameliorated the problems of poverty and immorality, it also made them more visible and unacceptable. Thus the ideas of social reformers, such as Henry Mayhew and Edwin Chadwick, dispersed through the evolving newspaper sector, had an immense impact on the middle classes, who, owing to urbanisation, lived in close proximity to the poor and were well aware of the dangers they posed (disease, crime, debauchery, and riot) to their own soft-feathered lives. Politicians, as this...