Adam Smith, Watch Prices, and the Industrial Revolution

17 Pages Posted: 1 Mar 2015 Last revised: 5 Mar 2015

See all articles by Morgan Kelly

Morgan Kelly

University College Dublin (UCD) - Department of Economics

Cormac O'Grada

University College Dublin (UCD)

Date Written: February 28, 2015

Abstract

Although largely absent from modern accounts of the Industrial Revolution, watches were the first mass produced consumer durable, and were Adam Smith’s pre-eminent example of technological progress. In fact, Smith makes the notable claim that watch prices may have fallen by up to 95 per cent over the preceding century; a claim that this paper attempts to evaluate. We look at changes in the reported value of over 3,200 stolen watches from records of criminal trials in the Old Bailey court in London from 1685 to 1810. Before allowing for quality improvements we find that the real price of watches in nearly all categories falls steadily by 1.3 per cent per year, equivalent to a fall of 75 per cent over a century, a rate considerably above the growth rate of average labour productivity in British industry in the early nineteenth century.

Keywords: Adam Smith, Industrial Revolution, productivity change

JEL Classification: N0

Suggested Citation

Kelly, Morgan and O'Grada, Cormac, Adam Smith, Watch Prices, and the Industrial Revolution (February 28, 2015). Available at SSRN: https://ssrn.com/abstract=2571637 or http://dx.doi.org/10.2139/ssrn.2571637

Morgan Kelly

University College Dublin (UCD) - Department of Economics ( email )

Belfield
Dublin 4, Dublin 4
Ireland
+353 1 706 8611 (Phone)
+353 1 283 0068 (Fax)

Cormac O'Grada (Contact Author)

University College Dublin (UCD) ( email )

Dublin 4, 4
Ireland

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