The Industrial Revolution in Miniature

This paper uses the adoption and invention of the spinning jenny as a test case to understand why the industrial revolution occurred in Britain in the eighteenth century rather than in France or India. It is shown that wages were much higher relative to capital prices in Britain than in other countries. Calculation of the profitability of adopting the spinning jenny shows that it was profitable in Britain but not in France or in India. Since the jenny was profitable to use only in Britain, it was only in Britain that it was worth incurring the costs necessary to develop it. That is why the jenny was invented in Britain but not elsewhere. Irrespective of the quality of their institutions or the progressiveness of their cultures, neither the French nor the Indians would have found it profitable to mechanize cotton production in the eighteenth century. keywords: industrial revolution, invention, technological change, great divergence JEL classes: N63, N65,N73,N75,O14,O31,O33