Causality and the First Industrial Revolution.

The existence, timing and possible causes of the British industrial revolution are considered by investigating the time series properties of industrial production and various explanatory variables. Utilizing co-integration-based causality tests, this paper argues that domestic forces, notably population, real wages and technological progress, shaped the industrial revolution, whereas overseas trade expansion was a consequence of industrial growth. The first industrial revolution may shed more general light on the forces promoting industrialization and growth. To the extent that the first industrial revolution offers a template, exports do not appear to provide a simple pathway in industrialization.