Friday, 20 June 2014

How did we British get our empire?

Was it imperial conquest, built on the back of the slave-trade, or the fruit of the scientific enlightenment married to British engineering and can do?, or was it just cheap energy wot dun it?

Here are the facts:

In 1750, most of the world’s manufacturing took place in China (33% of the world total) and the Indian subcontinent (25%). Production per person was lower in Asia than in the richer countries of Western Europe, but the differentials were comparatively small. By 1913, the world had been transformed. The Chinese and Indian shares of world manufacturing had dropped to 4% and 1% respectively. The UK, the USA, and Europe accounted for three-quarters of the total. Manufacturing output per head in the UK was 38 times that in China and 58 times that in India. Not only had British output grown enormously, but manufacturing had declined absolutely in China and India as their textile and metallurgical industries were driven out of business by mechanized producers in the West.

Share of global manufactures

It was cheap energy wot done it.

Price of energy ~1750: Grams of silver per million BTUs

In the Middle Ages, charcoal and firewood were the principal fuels burned in cities. As the cities grew, wood prices skyrocketed, and substitute fuels were developed. In the Netherlands, the alternative was peat; in England, it was coal. Coal was mined in Durham and Northumberland and shipped down the coast to London. England was the only country in the world with a large coal-mining industry in the 18th century, and that also gave it access to the cheapest energy in the world. The price of British energy was just 8.5% that of Chinese. Steam engines allowed Britain to lever energy to increase labour productivity. Trade did the rest :- wiping out, first Indian, then Chinese industry.

The world is now turning full-circle, partly by bringing down the cost of energy in South East Asia. Electricity in India and China is now the cheapest in the world.

Comparing International Electricity Costs (2011), per unit (kWh)
PS: 1¢ = USD 0.01

This blog post is mostly copied from: Robert C. Allen: Global Economic History: A Very Short Introduction. OUP.

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