Economic Growth and Development Concepts

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Questions and Answers

According to Mokyr, what is a key factor in the emergence of economic growth?

Suppression of skepticism to maintain social stability.

The proliferation of traditional methods and practices.

A 'culture of growth' that values science and useful knowledge. (correct)

A decline in technological advancements.

Which of the following is NOT typically considered a political and institutional change that fosters a market economy?

Maintaining traditional artisan shops and farming practices. (correct)

The formation of financial markets.

The introduction of labor markets.

Establishing robust property rights.

What structural change is often associated with 'development'?

A shift away from traditional occupations towards industrial activities. (correct)

The move from urban centers to rural areas.

Increased reliance on individual artisan shops.

Growth in traditional occupations like agriculture.

Which period saw the largest increase in the growth rate of total production (GDP) in Britain?

1830-1870 Signup and view all the answers

According to the data, how did the growth rate of industrial production change between 1760 and 1870 in Britain?

It increased steadily over time. Signup and view all the answers

What does the term 'juridical persons/limited liability' refer to in the context of economic development?

A legal separation between the company and its owners. Signup and view all the answers

Based on the provided data, which sector consistently had the lowest growth rate between 1760 and 1870?

Agriculture Signup and view all the answers

What do R1 and R2 measures, as referenced by Dasgupta and Weale, attempt to quantify?

The quality of life through a numerical scale. Signup and view all the answers

Which sector experienced the greatest average annual growth rate between 1770 and 1831?

Cotton Signup and view all the answers

What was the total industrial output in Britain in 1801, in millions of £?

54.1 Signup and view all the answers

Which industry saw its percentage share of total industrial output decrease between 1770 and 1830?

Wool Signup and view all the answers

Approximately how much larger was the value of the construction sector in 1830 compared to 1770?

11 times larger Signup and view all the answers

Which of the following industries experienced the smallest percentage share growth in total industrial output over the entire period?

Linen Signup and view all the answers

Which sector had the second highest average annual growth rate between 1770 and 1831?

Construction Signup and view all the answers

If the value of the soap industry in 1801 was $x$ million £, what is the approximate value of $x$ in this case?

$0.8$ Signup and view all the answers

Which of the following statements about the distribution of industries is MOST consistent with the data provided?

The cotton industry drastically increased its share of total industrial output by 1830. Signup and view all the answers

According to the provided text, what was a significant factor contributing to Britain's wage and price structure?

Its success in international trade through mercantilism and imperialism Signup and view all the answers

What is presented as a potential reason for the higher productivity of British workers during the early Industrial Revolution?

They were physically stronger and better fed. Signup and view all the answers

What was the primary power source for the earliest phase of the Industrial Revolution?

Water mills Signup and view all the answers

What was a key characteristic of the 'culture of growth' discussed in reference to Joel Mokyr's work?

A combination of scientific revolution, social status, and industrial enlightenment Signup and view all the answers

According to the provided information, what was a unique aspect of the Enlightenment in Britain compared with other European countries?

An emphasis on empirical and experimental approaches. Signup and view all the answers

What was a key outcome of the institutionalization of science, as mentioned in the text regarding Francis Bacon's followers?

A coalition with commercial and land-based interests. Signup and view all the answers

What does the text say was a barrier to progress in China during the period mentioned?

Isolationist policies and difficulty in challenging established wisdom Signup and view all the answers

What is most accurate about the relationship between British science and the state during the era discussed?

British science was not state-led but instead formed a coalition with commercial and landed interests. Signup and view all the answers

According to North and Weingast, what was a key outcome of the Bill of Rights (1688)?

The establishment of the budget right for Parliament and a more level playing field for people when taking the government to court. Signup and view all the answers

Why were governments often seen as needing to be exploitative to secure funds before 1688?

Because they lacked the ability to credibly guarantee repayment of loans, leading to a vicious circle of mistrust. Signup and view all the answers

What was a direct consequence of the budget right and more independent courts in Britain?

Increased lending to the government, as it became a more reliable borrower. Signup and view all the answers

What does the quote 'Britain's government was one of, by, and for private property' (Mokyr 1993) imply in the context of the text?

That Britain's government was primarily focused on protecting and supporting private property rights. Signup and view all the answers

How did the establishment of budget rights and independent courts contribute to increased credit availability, according to the text?

By decreasing the risk of lending to the government and fostering a more stable financial environment. Signup and view all the answers

How did lower transaction costs contribute to economic development?

By facilitating smoother functioning of innovation, capital markets, and trade. Signup and view all the answers

What is one way that 'good' political institutions supported economic development?

By establishing budget rights and independent courts, leading to more credible government and reduced risks for investors. Signup and view all the answers

What does the text suggest about the relationship between institutions and development?

Institutions are an important part of development but not necessarily the only factor that explains it. Signup and view all the answers

What fundamental shift occurred in the relationship between production and consumption due to the Industrial Revolution?

Production became separated from consumption, leading to a dis-embedded economy. Signup and view all the answers

How did the Industrial Revolution influence the perception of rural areas and agriculture?

They came to be viewed as backward sectors compared to urban areas. Signup and view all the answers

What significant global pattern emerged as a result of the Industrial Revolution and its uneven spread?

The creation of distinct economic centers and peripheries with unequal development. Signup and view all the answers

What major consequence arose from the increased use of more efficient steam engines during the Industrial Revolution?

A rebound effect leading to more widespread fossil fuel use. Signup and view all the answers

What was a significant social issue that arose in the first factory towns due to rapid industrialization?

Lack of proper sanitation and higher child mortality rates. Signup and view all the answers

How did the Industrial Revolution affect the workforce in terms of their labor conditions?

Work became significantly harder, with the shift to factory-based production. Signup and view all the answers

What long-lasting effect did the spatial separation between factory owners and workers have on cities?

It created spatial patterns of settlement based on economic inequality that persist today. Signup and view all the answers

What question does the text raise regarding the use of coal and oil as the main fuel sources of modern economy?

Are coal and oil the only source of energy to fuel modern economic growth? Signup and view all the answers

If effective energy had remained at 1800 levels, what would have happened to GDP per capita by 2000?

It would have been roughly one third of its 1800 level. Signup and view all the answers

From 1760 to 1830, by approximately what percentage did energy consumption from coal increase each year in Britain?

2.2% per year Signup and view all the answers

What does the text suggest about the growth rate of output compared to the growth rate of coal consumption between 1760 and 1830?

Coal consumption growth was faster than the growth of output. Signup and view all the answers

Which of the following correctly describes what likely happened to energy intensity of GDP in Britain during the period of 1760-1830?

It increased as coal consumption increased faster than output. Signup and view all the answers

How did the British industrial revolution growth rates differ with and without increasing energy use?

Growth rates would have been significantly lower without the increase of energy. Signup and view all the answers

What was the yearly growth rate of energy consumption from coal alone from 1700 to 1760?

1.2% per year Signup and view all the answers

According to the provided text, which of the following books is NOT one of the main references?

The Wealth of Nations by Adam Smith Signup and view all the answers

Between 1760 and 1830, how did the growth of labour and capital stock compare to the growth in energy consumption?

Both labor and capital stock grew slower than energy consumption. Signup and view all the answers

Study Notes

Introduction to the British Industrial Revolution

The Industrial Revolution saw a significant increase in income per person after 1800 in many countries.
The British Industrial Revolution occurred between 1760/70 and 1830/50, lasting 60-70 years.
This period experienced a dramatic shift in the economy, moving away from agriculture toward industry and services.
The revolution involved significant technological and organizational changes.

Indicators of Change

Changes in Gross Domestic Product (GDP) per capita and population growth rates are key indicators of economic change.
The growth rate of industrial production, agriculture, and service sectors provide a breakdown of changes in those areas.
Productivity and efficiency increased dramatically in many sectors during this period.
Data from the period show rapid growth in various economic indicators.

Productivity/Efficiency Growth

Neoclassical growth accounting approaches are used to assess growth factors, separating growth into growth of inputs (land, labour, capital) and total factor productivity (TFP) growth.
TFP growth measures improvements in overall efficiency and can result from technological or organizational advancements, which are key components of productivity increases.
Examples given include improvements in cotton spinning technologies and the development of the steam engine.
Productivity gains in industry exceeded those in agriculture and other sectors, with industry becoming more prominent.

Why Britain?

Geography, institutions, demographics, and agriculture played important roles in the British Industrial Revolution.
Geographic advantages, such as an island nation, facilitated trade and provided access to resources.
Strong institutions, like well-defined property rights and a parliamentary system, provided stability and incentives.
Demographics and workforce characteristics, such as rates of growth and literacy levels, aided the process.
Increased agricultural productivity freed labour for other industries.

Consequences of the Industrial Revolution

Social change, including the separation of production from consumption, had a significant impact on society.
Urbanization, driven by demand for factory workers, led to the growth of cities and associated challenges.
The industrial revolution spurred global connectivity, but also exploitation and inequalities, like in the conquered peripheries.
The revolution’s environmental impact is a key aspect for consideration as the transition to modern economic growth was fuelled by climate change and fossil fuel use.

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Description

This quiz covers key concepts related to economic growth and structural changes as discussed by Mokyr and others. It explores historical growth rates, the impacts of political and institutional changes, and various sectors of the economy from the 18th to 19th century in Britain. Test your knowledge on the factors influencing market economies and industrial output during this significant period.