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The evolution of markets and the revolution of industry: a unified theory of growth.
- Source :
- Journal of Economic Growth; Sep2012, Vol. 17 Issue 3, p205-234, 30p
- Publication Year :
- 2012
-
Abstract
- This paper puts forth a theory of the Industrial Revolution whereby an economy transitions from Malthusian stagnation to modern economic growth as firms implement cost-reducing production technologies. This take-off of industry occurs once the market reaches a critical size. The mechanism by which market size affects process innovation relies on two overlooked facts pre-dating England's Industrial Revolution: the expansion in the variety of consumer goods and the increase in firm size. We demonstrate this mechanism in a dynamic general equilibrium model calibrated to England's long-run development, and explore how various factors affected the timing of its industrialization. [ABSTRACT FROM AUTHOR]
Details
- Language :
- English
- ISSN :
- 13814338
- Volume :
- 17
- Issue :
- 3
- Database :
- Complementary Index
- Journal :
- Journal of Economic Growth
- Publication Type :
- Academic Journal
- Accession number :
- 78389260
- Full Text :
- https://doi.org/10.1007/s10887-012-9080-y