Opposition to innovation is the most salient feature of how guilds interacted with disruptive new processes and products. Pre-modern people often complained that guilds blocked innovations. Guilds themselves openly conducted lobbying campaigns to prevent guild members and outsiders from producing things in new ways. Municipal, princely, seigneurial, and imperial governments were constantly considering guild petitions against innovations, and often passed legislation to deal with the issue.86
In a detailed study of English patents and legal cases in Elizabethan and Jacobean times, the legal scholar Chris Dent found that “the legal decisions of the period confirm that the maximization of employment was a priority of the elites.”87 Attitudes toward replacing technologies during this period much resembled those of classical antiquity in that the technologies were opposed by the political elites to avoid social unrest. Relative to medieval times, the rise of strong nation–states between the fifteenth and the seventeenth centuries also meant that governments again had greater influence over technological progress. With the feudal order of the Middle Ages, power was split among highly decentralized feudal lords, who maintained their own armies. The territory of the crown was thus merely a patchwork of scattered and largely independent domains, with no central administration. Over time, however, growing competition between monarchs required more resources to be mobilized for warfare, and more centralized structures to achieve the pooling of those resources.88 The military historian Quincy Wright estimates that fifteenth-century Europe consisted of some five thousand political units, but by the time of the Thirty Years’ War (1618–48), these had been consolidated into some five hundred.89 The emergence of infantry armies meant that the landed nobility lost ground as an efficient provider of military protection, and feudal oligarchies were replaced by centralized monarchies. According to the political scientist Charles Tilly, “war made the state and the state made war.”90 Between 1500 and 1800, Spain was at war with an enemy 81 percent of the time, while Britain and France were at war more than 50 percent of the time.91 This, in turn, also spurred efforts to innovate. Indeed, as the economic historians Nathan Rosenberg and L. E. Birdzell Jr. argue, “In the West, the individual centers of competing political power had a great deal to gain from introducing technological changes that promised commercial or industrial advantage … and much to lose from allowing others to introduce them first. Once it was clear that one or another of these competing centers would always let the genie out of the bottle, the possibility of aligning political power with the economic status quo and against technological change more or less disappeared from the Western mind.”92
The realization that political power was becoming harder to align with technological conservatism is suggested by the fact that governments began to subsidize engineers, grant patents to inventors, and created monopolies for key commercial interests. Famous examples of government-driven technological catch-up include Tsar Peter the Great’s determination to modernize Russia, leading him to work at a Dutch shipyard under the pseudonym Pyotr Mikhailov, to learn about shipbuilding. But while governments clearly felt the need to promote technical progress, they were selective in the technologies they promoted, and as we have seen, they did their best to restrict the adoption of replacing technologies. Thus, overall, the technologies of the Renaissance were levers of Smithian growth rather than engines of Schumpeterian growth. Navigation, for example, became critical to the international trade that Europeans powers now engaged in. And for this, astronomical instruments and compasses constituted enabling technologies. Indeed, the Renaissance period has aptly been described as the “age of instruments” in technological terms. The telescope, barometer, microscope, and thermometer were among the prime technical achievements of the time, and they were adopted for a variety of purposes. While the telescope was used by Galileo to observe the moons of Jupiter, Prince Maurice of Nassau used it to look at the Spanish armies, while his captains employed it to spot enemy warships at sea. Even when trade and warfare were not among the intended applications of the inventions, they came to serve such purposes.93
The age of instruments came with important spillover effects, as the shops of instrument makers became meeting places for scientists, craftsmen, and amateurs and played a vital role in the dissemination of new ideas, facilitating the interaction between science and technology. As Cardwell has pointed out, “It is enough to record that by 1700 the foundations of modern technology had been laid. Appropriately, the word technology had been coined before the end of the century; and it seems likely that the word inventor was beginning to be used in the way in which it is understood today.”94 This, however, makes it even harder to explain why the Industrial Revolution did not arrive earlier.
2
PREINDUSTRIAL PROSPERITY
The frontiers of technology in Europe had expanded significantly by the eighteenth century. Yet the impact of this expansion on growth and prosperity remains controversial. Gregory Clark has gone as far as to suggesting that “had consumers in 8000 B.C. had access to more plentiful food, including meat, and more floor space, they could easily have enjoyed a lifestyle that English workers in 1800 would have preferred to their own.”1
For anyone familiar with Jane Austen’s writings about the eighteenth-century British upper classes, there can be no doubt that some enjoyed living standards far superior to those of hunter-gatherers. In Austen’s Sense and Sensibility, first published in 1811, Colonel Brandon refers to a rectory that provided an annual income of £300: “This little rectory can do no more than make Mr. Ferrars comfortable as a bachelor; it cannot enable him to marry.”2 The average farm laborer at the time had an annual income of about a tenth of Mr. Ferrars, which still did not allow him to find a wife. To further put Mr. Ferrars’s income in perspective, in the same year that Sense and Sensibility appeared, William Spencer Cavendish, marquess of Hartington and heir to the fifth duke of Devonshire, came of age. The sixth duke’s inheritance included four country houses: Chatsworth House and Hardwick Hall in Derbyshire, Bolton Abbey in Yorkshire, and Lismore Castle in southern Ireland. He also had three London palaces to reside in: Chiswick House, Burlington House, and Devonshire House. And his estates were supported by land in Ireland and eight English counties, yielding an annual income of £70,000.3 The extreme income disparities suggested by such anecdotal evidence are also borne out by the statistics. The top 5 percent of British income earners in 1801 captured more than one-third of total household income (in real terms), which had even increased slightly by 1867.4 In that year, after a visit to the House of Lords, the historian Hippolyte Taine remarks that “the principal peers present were pointed out to me and named, with details of their enormous fortunes: the largest amount to £300,000 a year. The Duke of Bedford has £220,000 a year from land; the Duke of Richmond has 300,000 acres in a single holding. The Marquess of Westminster, landlord of a whole London quarter, will have an income of £1,000,000 a year when the present long leases run out.”5
How did such inequalities come about? The first thing to note is that the incomes of wealthy noblemen, such as the Duke of Devonshire and the Marquess of Westminster, came from capital rather than labor. Capital was the predominant force behind the income disparities in Jane Austen’s Britain. According to estimates by the economic historian Peter Lindert, the top 10 percent of the population had more than 80 percent of Britain’s wealth in 1810.6 Most of this wealth came from land. National wealth was roughly seven times the value of the national income, and agricultural land constituted about half of national wealth.7 In other words, the fortunes of the landowning classes would not have been possible without one important technology: agriculture. Without it, the landed classes in eighteenth-century Britain would never have appeared. The fact that the gifts of the Neolithic revolution still shaped society in the eighteenth century, some ten thousand years later, suggests that despite millennia of technological change, economic life had not yet been fundamentally altered. Most people still worked on farms in the domestic
system, which indicates that there had been little labor-replacing technical progress. Although there was an emerging middle class, social status and wealth was still derived from the land.
The Idiocy of Rural Life
For most of human history, there was no wealth and no inequality. The age of inequality began with the Neolithic revolution. The following period constituted only a brief episode of human history, relative to the forager era that preceded it. As noted, in the absence of any technology for storing meat, instant consumption was inevitable, and no significant food surplus was attainable. It was only after the invention of agriculture that food could be stored, land could be owned, and individuals could accumulate a surplus of significance—which in turn introduced the concept of property rights and a political structure to uphold those rights. Of course, prehistory does not provide any records of how the first political structures came about, but the rise of the feudal system in medieval Europe clearly constituted an exchange of peasant labor for knightly protection. The early beginnings of political authority are likely to have followed a similar pattern. The provision of a political structure provided some stability, but it came at the price of inequality.8 Skeletons from Greek tombs at Mycenae of around 1500 B.C. show that royal skeletons were two or three inches taller and had substantially better teeth than those of commoners, suggesting that royals fared better in terms of nutrition. Further evidence is provided by Chilean mummies from around A.D. 1000, showing that the elite exhibited substantially lower rates of bone lesions caused by disease, in addition to other distinguishing features of wealth such as ornaments and gold hair clips.9 The notion that political inequality stems from the invention of agriculture, as the philosopher Jean-Jacques Rousseau suggested, thus seems to hold.10
Of course, the price of inequality might be low if the commoner also benefited from the arrival of agriculture. One of the great questions in archaeology therefore concerns the impact of agriculture on the prosperity of ordinary people. Although data on living standards in preindustrial times remain sparse, food consumption clearly constitutes one important dimension. Building on the intuition that while an individual’s height depends on genes, the heights of populations reflect patterns of food consumption, archaeologists often rely on heights to measure food intake.11 Especially in societies where people are sufficiently poor for the demand for food to rise rapidly with their income, heights constitute a reasonable proxy for food consumption. Beyond height, anthropologists have looked at various indicators of well-being (including skeletal and dental features), which sometimes provide a somewhat different picture. Yet on balance, the available evidence suggests that the post-Neolithic rise in inequality was accompanied by a fall in average standards of living.
While it was long believed that the invention of agriculture dramatically improved the life of the commoner—relieving humanity of the burden of constant movement in the search for food—the body of data that has emerged since the 1960s shows that romantic views of the agricultural lifestyle are incorrect. Studies of societies that have shifted from foraging to agriculture for subsistence typically have found this transition to be associated with shorter people, deteriorating health, and an increase in nutritional deficiencies. For example, the anthropologists George Armelagos and Mark Cohen document declining health in nineteen out of twenty-one societies that underwent transformation to agriculture.12 Reviewing the available evidence, Clark Spencer Larsen, another anthropologist, similarly concluded that the adoption of agriculture was accompanied by an overall decline in general health, as suggested by various skeletal and dental pathological conditions.13 Although a number of studies have emerged since, Armelagos and coauthors recently revisited the question and found that the adoption of agriculture has been associated with a decrease in adult height and a reduction in general health. They further observe that the decreasing stature in populations holds across continents and the periods during which agriculture was adopted.14 These findings are also consistent with evidence suggesting that hunter-gatherers had a much more diverse diet, and that the narrowing of the types of food consumed that is associated with agriculture led to growing deficiencies in some essential nutrients.15
The fact that living conditions deteriorated with the arrival of agriculture has left many economists, anthropologists, and archaeologists puzzled as to why hunter-gatherers would have voluntarily exchanged their lives for what the Communist Manifesto called the “idiocy of rural life.”16 One possibility, of course, is that the adoption of agriculture was the result of population pressures and the increasing difficulty of foraging for food as population densities among hunter-gatherers gradually increased toward the end of the Ice Age.17 For example, the ecologist Jared Diamond has suggested that “forced to choose between limiting population or trying to increase food production, we chose the latter and ended up with starvation, warfare, and tyranny.”18 But causality might equally have run in the opposite direction. Another theory is that higher productivity simply resulted in larger populations with no per capita income gains. Agriculture was adopted because it was a better technology, which initially generated higher incomes for the bulk of the population. Nevertheless, with the arrival of agriculture, the cost of having more children fell as mothers no longer had to carry their babies in search for food. And because higher incomes could feed more people, population growth surged, offsetting any income gains in per capita terms. Of course, there is no way of knowing in which direction causality ran. Most likely both explanations have some merit. What is clear is that populations surged with the adoption of agriculture. Population densities of hunter-gatherers were rarely over one person per square mile and often substantially lower, while farmers averaged forty to sixty times that density.19
The Population Curse
The idea that better technology results only in larger populations is an appealing one because it also helps explain why growth was stagnant for most of human history. Like the adoption of agriculture, the spread of every new productivity-enhancing invention helped only grow the population. The intellectual foundation for this intuition is the Malthusian model, put forward by Thomas Robert Malthus in 1798. This model describes an organic society in which the laws that govern human economic activities are the same as those that govern all animal societies. The sizes of both animal and human populations depend on the available resources for consumption. Over the long run, according to the Malthusian model, people’s incomes—and thus their resources for consumption—are determined by fertility and mortality alone. So the higher the fertility rate and the more people there are, the smaller share of these resources each individual has access to. Conversely, if the mortality rate increases for a reason such as disease or drought, those who are left will enjoy a larger proportion of the resources. Thus, even though the technological advances that took place in preindustrial times were cumulatively significant, slow technology adoption meant that no permanent income gains could be achieved. Because population adjustments take time, advances in technology had the potential of leading to higher incomes in the short run. But over the long run, growing incomes led to a reduction in death rates, and when birth rates started to exceed death rates, populations began to grow. In the end, the only effect achieved by moving toward a higher plateau of technology was a larger population, which eventually stopped growing when income returned to subsistence levels.20
Many historians have remarked that Malthus put forward his thesis just as the idea became irrelevant—at the onset of the Industrial Revolution, when England finally broke the iron law of wages and escaped the Malthusian trap.21 Some economists and historians still believe that the preindustrial world was caught in a vicious cycle in which demographic negative feedbacks prevented per capita incomes from growing.22 There is probably some truth to this belief, but to suggest that the Malthusian model applied to all preindustrial societies would be a stretch. First, empirical studies have shown that fluctuations in fertility and mortality in preindustrial societies were not prim
arily driven by variation in wages, at least from the sixteenth century onward.23 Second, some places had already achieved sustained income growth prior to the Industrial Revolution.24 While data on wages before the late Middle Ages remain scant, the Roman Emperor Diocletian issued an edict on maximum prices in A.D. 301, which included information on Roman wages. On the basis of Diocletian’s wage schedules, the economic historian Robert Allen has estimated that a typical unskilled Roman worker earned just about enough to purchase a minimal subsistence basket, and that the workers’ real wages were similar to those of their counterparts in eighteenth-century south-central Europe and Asia.25 Yet by 1500, Britain and the Dutch Republic had already started to experience a small divergence from the rest of Western Europe and the world, and by 1775, the wages of laborers in London and Amsterdam had pulled ahead of those of their peers elsewhere (figure 3).
FIGURE 3: Nominal Wages in Grams of Silver per Day, 1325–1775
Sources: R. C. Allen, 2001, “The Great Divergence in European Wages and Prices from the Middle Ages to the First World War,” Explorations in Economic History 38 (4): 411–47; R. C. Allen, J. P Bassino, D. Ma, C. Moll-Murata, and J. L. Van Zanden, 2011, “Wages, Prices, and Living Standards in China, 1738–1925: In Comparison with Europe, Japan, and India,” Economic History Review 64 (January): 8–38.
The latest revisions to Angus Maddison’s heroic gross domestic product (GDP) estimates point in a similar direction: per capita incomes were largely stagnant in most economies prior to 1500 but increased in Britain and the Dutch Republic thereafter.26 In the seventeenth-century Ottoman Empire, per capita incomes (Int$700 in 1990 prices) were no higher than those in Byzantium and Egypt during the first century A.D., which at the time were slightly higher than in Britain, the Netherlands, and Spain (Int$600 in 1990 prices). Between the first and the eighteenth centuries, average incomes in Spain barely increased, stabilizing at roughly the same level as per capita incomes in Britain and the Netherlands by the thirteenth century (around Int$900 in 1990 prices). But following the bubonic plague (the so-called Black Death) of 1348, which carried away 30–50 percent of Europe’s population and caused a long period of population decline, average incomes in Britain and the Netherlands started to grow more rapidly.27 However, such growth should not be overstated, as growing per capita incomes were largely the result of a shrinking population. As population growth rebounded in Britain, per capita incomes fell slightly in the period 1400–1500. Yet from 1500 onward, per capita incomes in Britain and the Dutch Republic almost doubled, reaching Int$2,200 and Int$2,609 (in 1990 prices) by 1800, respectively. Meanwhile, the rest of Europe—including Belgium, Germany, Portugal, Spain, and Sweden—witnessed no meaningful growth. Of course, there is no way of ascertaining that these estimates are correct, but wage data and GDP estimates alike suggest that the economies of Europe followed different trajectories in 1500–1800.
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