Key Factors Driving the Industrial Revolution (1750–1870)

Rethinking the Industrial Revolution (1750–1870): Misconceptions

The term "Industrial Revolution" (IR), spanning approximately 1750 to 1870, may be misleading for two primary reasons:

1. Evolutionary Change vs. Radical Rupture: The word "revolution" evokes an image of a radical rupture, while the IR was fundamentally a process of evolutionary and cumulative economic change. Moreover, for more than half a century, the English economy presented a dual aspect where new and old technologies coexisted.
2. Scope Beyond Industry: The term "industrial" seems to exclusively limit this process of change to the field of industry. In reality, these transformations affected all sectors of the economy (demography, agriculture, transport, science, etc.). These sectors did not simply play a subordinate or accompanying role; their transformation was a necessary condition for the Industrial Revolution to eventually crystallize.

The Four Pillars of Economic Transformation

The profound change during this era is primarily explained by a significant improvement in productivity, which was, in turn, due to four interconnected sets of factors:

1. Technological Innovations

Technological innovations spread rapidly from manufacturing to agriculture and transport, fundamentally replacing:

1. Animate Power: Replacement of animate power by inanimate energy engines (such as the steam engine), offering greater power and regularity of work.
2. Inelastic Fuels: Substitution of fuels and energy sources with inelastic supply and difficult transportation and storage (e.g., vegetable coal, wind, and hydraulic energy) by fossil or mineral energy (mineral coal).
3. Organic Raw Materials: Replacement of organic raw materials (wood, natural dyes, organic fertilizers) by inorganic materials (bricks, artificial dyes, chemical fertilizers).

2. Productivity and Efficiency Gains

These gains resulted directly from innovations, leading to a greater capitalization of the economy (the substitution of labor-intensive production functions with capital-intensive production functions) and increased overall productivity. These gains derived from two main types:

• Efficiency Gains: New machinery produced more output with fewer inputs and in less time.
• Economies of Scale:
  • External Economies: Improvements in infrastructures and shared know-how.
  • Internal Economies: Increasing returns achieved when the volume of production increases.

3. Organizational and Institutional Changes

This period saw a crucial shift from economic organizations characteristic of pre-industrial economies (such as collective or family mercantile societies, guild workshops, or trade companies) to modern capitalist companies (factories, farms, shipping or rail companies, banks).

These institutional changes significantly contributed to improving productivity and efficiency through the factory system, which facilitated:

• Professionalization of work and organizational management.
• Division and specialization of labor (e.g., manufacturing processes).

4. Structural Changes in Society and Economy

Society became more industrial, less rural, and increasingly urban. This involved a massive transfer of productive factors (labor and capital) across sectors:

• Transfer from agriculture to industry.
• Transfer from the production of consumer goods (food, clothing) to the production of capital goods (machinery, infrastructures).