The final precondition of the Industrial Revolution was the development of early, or "proto"-industry. In the centuries preceding the Industrial Revolution, the household became an important unit for producing goods (mostly textiles) by a process called "proto-industrialization." As demand for goods, and particularly for cloth goods, grew, "proto-industrialization" became pivotal to fulfilling the need for increased supply. In proto-industrialization, which had existed since the Middle Ages, merchants lent - or "put out" - raw textile fibers and, sometimes, simple equipment to peasant families. The families then used their time, when not working the land, to spin, weave, and prepare finished cloth, which the entrepreneurial merchant collected periodically. After paying the peasants a minimal fee, the merchants sold the products on the national, or international, markets.

For the peasants, but particularly for the merchants, this putting-out system had several advantages:

  1. The peasants could supplement their agricultural income and take advantage of the winter months when farming was impossible.
  1. Merchants could avoid the higher wages and often demanding regulations of urban labor; when the need arose, it was easier to reduce the number of workers.
  1. Merchants could acquire capital, which would later play a part in funding industrialization itself, and peasants acquired skills for the future.
  1. Young people could establish separate households earlier, thus facilitating population growth.
  1. Capitalists had greater flexibility, especially when demand for their goods flagged.

Proto-industrialization also had one significant disadvantage, however. When demand rose - as it did in the 18th century - it proved inefficient. The merchant-capitalists found it difficult to induce the peasant-workers to increase their output. This dilemma eventually led to a factory system, in which all the workers were concentrated in one place under the supervision of a manager, and where water or steam power could easily be provided. Thus, proto-industrialization contributed to the Industrial Revolution through its advantages and limitations alike.

An Industrial Revolution?

To speak of an Industrial Revolution is to imply that Europe experienced a dramatic and rapid economic transformation and social upheaval. But in recent years, some historians have challenged the notion that there ever was a clearly discernible, dramatic break in economic relations. They have suggested that the economy changed more slowly and gradually than previously thought, or that older methods of production continued into the 19th and even 20th century. It has become accepted that the Industrial Revolution was a much more prolonged process than was once thought. Most economic historians still find it useful, however, to speak of a distinct Industrial Revolution, even if it was quite gradual just as today we sense that we are living through a "Computer Revolution," even if most aspects of our lives have not been totally changed by it. (What factors made the Industrial Revolution a revolution?)

One way to begin to define the Industrial Revolution is to delineate what it was not. Commercial development alone cannot account for the transformation of the late 18th and early-19th centuries. The Industrial Revolution was certainly not caused only by changes in trade. If trade alone had been responsible, the Netherlands (a trading powerhouse in the 17th and 18th centuries) would have been a leading contender for the location of the Industrial Revolution. As it was, Holland clearly lost ground to the pioneer industrializing nation, England.

Nor was the Industrial Revolution a result of an increase in income and wealth. For much of the 18th century, the English economy grew at perhaps 1% per year. Growth accelerated slightly to about 2% per year by the late-18th century and during the first half of the 19th century. These rates were slower, however, than those of the periods 1896-1910 and 1948-1973, when the European economy as a whole grew at a rate of somewhere between 4 and 6%. Wealth alone does not explain the qualitative transformation the Industrial Revolution ushered in. In fact, the standard of living in England only really began to rise after 1820 (long after the start of the Industrial Revolution).

So if the Industrial Revolution was not a result of commercial development or income growth, how can it be explained? Let's examine what took place in Britain. During the early decades of the Industrial Revolution, Britain might best be described as a "dual economy," with one half continuing to engage in traditional forms of economic activity, while the other half was utilizing new, "mechanized" forms of manufacture. That is, the traditional sectors that were not susceptible to mechanization - domestic services, building and crafts - remained the preponderant element of the economy and grew at roughly .6% per year. On the other hand, a smaller mechanized sector of the economy, accounting for perhaps a third of all output, achieved a higher growth rate of 1.8% annually. It was this new form of mechanized production, involving stronger power sources, new machines, and concentrated labor, which above all else defined the Industrial Revolution. The Industrial Revolution, then, was not a revolution in trade or income, but in production.

Features of the Industrial Revolution

Prior to this period, goods had mainly been manufactured in urban workshops and homes. Where once manufactures (built goods) were produced in workshops and in homes (in accordance with the putting-out system), the Industrial Revolution launched an era of factories, concentrated labor, and new machinery, too expensive for the home and requiring large power sources. This new form of concentrated production could produce goods in greater number and with greater efficiency.

The Industrial Revolution relied on new sources of power, and new inventions (or a series of new inventions, each supporting the other and triggering yet more innovative machines). The steam engine, invented in 1702 by Thomas Newcomen and then significantly improved upon and patented by James Watt in 1769, illustrates both of these developments. The steam engine was invented in order to solve a problem associated with the use of an increasingly important source of energy: coal. The increasingly large amount of coal burned by developing countries necessitated the increased mining of more coal. As coalmines got deeper, water began to flood the mines. The steam engine was developed to solve this problem by powering pumps to remove excess water from the mines. The technology was then refined so that the steam produced was itself used to turn winches and wheels.

This new technology encouraged yet further growth and development. Since the steam engine consumed coal, it added to the overall demand for the energy source. This in turn fed the demand for more steam engines to pump mines. So the steam engine was an invention that, in effect, created its own demand. The more useful the engine, the more coal needed to power engines, and the more inducement to find new applications. Considering the multiplication of computing power and microprocessor capacity over the past twenty years might give you a sense of how mechanical efficiency grew in the industrializing sectors. The steam engine and coal, in turn, quickly spawned further changes. The problem of transporting the coal from the mines led to the invention of the first railroads, which themselves were powered by coal and steam. In turn, the spread of railroads increased demand for iron. Another method of transportation that came into being was the steamboat, which was to prove essential in the early development of America. Thus, the development of new energy sources spawned a whole host of other developments.


Innovation in industry was almost always a cumulative process. When an invention, such as James Kay's "flying shuttle" and Edmund Cartwright power loom, increased efficiency in one area of an industry, this triggered new innovations in other areas. For instance new methods of weaving cloth out of yarn sped up the cloth-making process, but created a demand for yarn that could not be met by traditional spinning. Thus, new methods of spinning were introduced, which revolutionized the industry and met the new demand.

Advancements in the treatment of raw materials were also vital to the Industrial Revolution. For example, until the mid-18th century, the processing of iron ore had been very expensive. Abraham Darby (1709) devised new technical improvements in heating the ore (with a special kind of coal), and Henry Cort (1784) devised new ways to purify molten iron (by puddling and rolling). Wrought iron was finally sufficiently cheap to be produced on a mass scale. By the second half of the century, air blasts would be blown through large vessels of molten iron, thus burning out impurities, and predetermined amounts of carbon could be re-added to make the particularly hard iron we call steel(essential for advanced machinery, weapons manufacture, and construction), which could be drawn and pressed in large units.

Iron, and later steel, was to become the cornerstone of the development of heavy industry. But from the late-18th century to the first decades of the 19th century, the textile industry was the most important beneficiary of new energy sources and was the center of significant mechanical innovation. In cotton manufacturing, the invention of the mechanical device known as the "jenny" dramatically increased the speed of spinning by allowing several threads to be spun at once. This advance, in turn, created a need met by the invention of power-driven (first by water, then steam) looms. England became a massive producer of cloth, and this export was by far her most important product during the first half of the Industrial Revolution.

Most of the cloth being manufactured was made of cotton, replacing wool as the most important fabric. Cotton was cheaper - especially after the invention of the cotton gin in America, which mechanically combed the seeds from the fiber - and lighter, and therefore could be sold in Britain's warm-weather colonies. Cotton was also easier to spin and weave mechanically, especially after Eli Whitney invented the cotton gin in 1793. From 1780 to 1860, the price of cotton fell eightfold. Again, one can compare this decline in price to that of computers in our own time.

Unfortunately, the greatly increased demand for cotton also had a deleterious social effect: it made large-scale production of cotton profitable, and encouraged the expansion of plantations in the American South, where the vast majority of work was performed by African slave laborers.

New inventions, better exploitation of raw materials, and new power sources all required new forms of labor. Another significant quality of the Industrial Revolution was that the organization and location of labor changed dramatically. In the Industrial Revolution, factories, in which many workers labored in the same place, replaced the scattered pattern of proto-industrialization or home production. Why? There are two explanations.

First, the water or steam power needed to operate the new machines had to be concentrated in one place, and so did the machines and workers. Huge machines and the power sources needed to run them could not, of course, be located in private homes.

Second, entrepreneurial convenience also played a role. As we discussed earlier, the old "putting-out" system proved unsatisfactory largely because merchants could not control the working pace of their peasant-laborers. The peasants often refused to do more work once they had earned enough to satisfy their wants. In the factory, however, owners or their managers directly supervised the work habits of their employees, and could therefore demand more from them. Merchant-capitalists no longer had to travel to scattered households, and they could store raw materials and finished output. Sometimes, especially on the Continent, they built factory housing so that the employee was never distant from the factory. Factories could also be located close to transportation networks and centers, which facilitated the movement of raw materials and finished goods.

Some historians have questioned whether the factory system (and the growth of the modern industrial workforce) was necessary for technological innovation, and have claimed that decentralized production could have remained in place. Such claims are hard to test, but even at points where technology might have allowed decentralized production (as after the development of the sewing machine), the grouping of workers into factories nonetheless took place. This is because once particular patterns of production begin they create a momentum that makes alternative forms seem less and less feasible. In any case, inevitable or not, the development of factories (and factory discipline) was one of the most noteworthy features of the Industrial Revolution.

Why was Britain the First to Industrialize?

Until now, our analysis of the Industrial Revolution has tacitly or explicitly taken Britain as the model. And indeed England was the first country to experience such a vast economic transformation. Why was this the case, and why didn't France, for example, become the pioneering industrial nation instead?

Let us consider France's strengths. In the late-18th and early-19th century, its technology was as advanced as that of England: the French had a very sophisticated loom (the Jacquard), and were superior in plate glass and cotton-bleaching technologies. In other basic categories, France's position in 1780 appeared to be at least as favorable as England's:





9 million

26 million


60 kilotons

136 kilotons


7.4 million lbs.

11 million lbs.



(25% by 1840)


(62% by 1840)

Britain, however, had several key advantages that allowed it to become the first nation to industrialize. First, on the eve of industrialization, England was already a wealthy country. More importantly, its agriculture was perhaps three times as productive as that of the Continent, generating profits that fueled consumption and manufacturing. And its wealth was more widely distributed than elsewhere in Europe. Thus, English industry could sell to a broad and wealthy market. (How do the initial conditions of the Industrial Revolution compare with those of today's "third world" economies, in which the general condition of the country is poor and the wealth that does exist is concentrated in a few hands?)

England also had the most advanced credit market of any country in Europe. Of course, much of England's early industrial expansion depended on self-financing, that is, on the re-investment of profits, but when needed (for railroads, etc.), investment capital was easily mobilized.

In addition, the cultural and social climates of England were conducive to commerce and industry. Unlike the Continent, England lacked strong urban guilds. These associations of craftsmen often acted to protect the quality of output and the status of workers, but also impeded the establishment of large-scale industrial innovation. Also, in England, religious "dissenters" - Puritans and later Quakers and other communities outside the mainstream culture of belief - enjoyed greater freedom or at least toleration than religious minorities elsewhere in Europe. As the late-19th-century German sociologist Max Weber discerned, the "Protestant ethic" played an important role in encouraging the rational, efficiency-valuing mentality important for entrepreneurship. Also, minority subcultures have often channeled their energies into economic and cultural achievement if excluded from the dominant culture (e.g., the Jews in central Europe, the Chinese in southeast Asia).

Finally, English merchants exhibited exuberance about the possibilities of growth and of human betterment through work and trade. This confidence was reflected in such social and economic reporting as Daniel Defoe's Tour of the Whole Island of Great Britain (1724-1726) and in Arthur Young's Tours in England and Wales (1768). Commentaries on industry and science, such as those authored by the Scottish Dr. Andrew Ure (The Philosophy of Manufactures) were wildly popular throughout Britain. The self-reliant man of economic energy (Robinson Crusoe in fiction, or later Josiah Wedgewood [1730-1795]) became a cultural hero, a feat far more difficult in countries where military and aristocratic, or bureaucratic, status was more widely recognized.

Social Changes Accompanying the Industrial Revolution

The Industrial Revolution effected several significant social changes. Indeed, this is one reason why the Industrial Revolution is considered a revolution. Rather than just launching new forms of economic production, the Industrial Revolution became a watershed in the social and political history of Europe.

First, labor relations changed in the countryside. The general rise in population and the enclosure movement gave rise to a new class of landless agricultural laborers. Moreover, during England's wars against France, the inaccessibility of continental grains caused agricultural prices to skyrocket, leading to even more enclosures and to dire circumstances for anyone dependent on fixed wages, as were many farm workers.

Second, bewilderment at how to deal with social changes and rising poverty led to changes in the system of public poor relief, as well as shifting notions of public welfare. The "Speenhamland" system, or "outdoor relief" (introduced in some regions of southern England in 1795), guaranteed the rural poor a minimum wage to be paid by the local parish rather than from a workhouse. It was designed, at least in theory, to keep employers from evicting their farm labor or preventing wages from falling below the level of subsistence. In practice, however, this system sometimes encouraged employers to reduce wages even further, and angered local taxpayers, who were, in effect, subsidizing landlords. The New Poor Law of 1834 made poor relief less attractive by insisting that any beneficiaries live in poorhouses ("indoor relief"), where family members were separated according to sex and the relief amounted to less than even the worst-paying job. Appalling conditions inside the poorhouses, and their growing role as dumping facilities for the elderly, led to scandals and exposés.

Third, the process of urbanization accelerated. The swelling population, poverty in the countryside, and the rise of industrial factories in the cities caused a great migration into urban areas. Jobs were not the only incentives for migrants, however, for the cities often promised amusements that village life could not provide. The cities, however, were ill prepared for such rapid expansion, and as a result, living conditions deteriorated. New immigrants were forced to find shelter in crowded, damp and dirty housing; water supplies were threatened; waste disposal became difficult, and disease spread. As a result, for a generation or so the death rate outpaced the birth rate in industrial cities. Only the constant immigration prevented a net decline in urban population. The historical judgments of this great social and economic transformation have been varied and controversial; they are taken up in the next chapter. Given all these facts, some historians in recent decades have challenged the earlier view that the standard of living went up, even in cities. The debate continues and the answers depend on the criteria, groups of people, and time frame considered. (What specific drawbacks might have accompanied the process of urbanization?)

Fourth, labor ultimately became increasingly differentiated along gender lines. In the countryside, men and women had once worked side by side. Now, however, new agricultural implements tended to require the physical effort associated with "men's work," and women began to devote more effort to household labor. This separation of work according to gender also took place in the city. During the course of the 19th century, as families moved beyond mere subsistence, they often opted to withdraw women from factory labor so that the women could work as full-time household organizers. This pattern continued into the 20th century, although it has undergone major transformation since the middle of the 20th century.