The Growing Dependence of Britain on Trade During the Industrial Revolution

35 Pages Posted: 24 Feb 2014  

Gregory Clark

University of California, Davis - Department of Economics

Kevin O'Rourke

University of Oxford

Alan M. Taylor

University of California, Davis - Department of Economics; University of Virginia - Department of Economics; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

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Date Written: February 2014

Abstract

Many previous studies of the role of trade during the British Industrial Revolution have found little or no role for trade in explaining British living standards or growth rates. We construct a three-region model of the world in which Britain trades with North America and the rest of the world, and calibrate the model to data from the 1760s and 1850s. We find that while trade had only a small impact on British welfare in the 1760s, it had a very large impact in the 1850s. This contrast is robust to a large range of parameter perturbations. Biased technological change and population growth were key in explaining Britain's growing dependence on trade during the Industrial Revolution.

Suggested Citation

Clark, Gregory and O'Rourke, Kevin and Taylor, Alan M., The Growing Dependence of Britain on Trade During the Industrial Revolution (February 2014). NBER Working Paper No. w19926. Available at SSRN: https://ssrn.com/abstract=2400271

Gregory Clark (Contact Author)

University of California, Davis - Department of Economics ( email )

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Kevin O'Rourke

University of Oxford ( email )

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Oxford, Oxfordshire OX1 4AU
United Kingdom

Alan M. Taylor

University of California, Davis - Department of Economics ( email )

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Davis, CA 95616-8578
United States
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530-752-9382 (Fax)

HOME PAGE: http://www.econ.ucdavis.edu/faculty/amtaylor/

University of Virginia - Department of Economics ( email )

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HOME PAGE: http://people.virginia.edu/~amt7u

National Bureau of Economic Research (NBER)

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Centre for Economic Policy Research (CEPR)

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