Britons who saw coal fuel nation's rise and rise

In the late 19th century, when British historians first turned their attention to economic matters, they paid close attention to the ideas of past economists. Adam Smith and T.R. Malthus were important as sources of information about early economic conditions and as part of the subject matter. As the discipline of economic history matured, however, historians became less interested in past economists' ideas. The events studied under headings such as the Industrial Revolution or the late-Victorian climacteric were analysed independently of the ideas of those who lived through them. Neither were past economists taken very seriously as sources: their knowledge seemed flimsy and unreliable in comparison with the facts and figures that modern historians were painstakingly assembling.

In this collection of essays by E.A. Wrigley, the situation has turned full circle. Smith and Malthus and their contemporaries are, once again, taken seriously as observers of economic growth in the period through which they lived. The heart of the book is Wrigley's reinterpretation of the 18th century.

Recent work has shown that the growth rate of British national income did not rise sharply during the Industrial Revolution, as had once been believed. Given that Britain was, by the mid 19th century, much wealthier than her European neighbours, it follows that this gap must have opened up well before the Industrial Revolution - no later than the middle of the 18th century. This leads Wrigley to the conclusion that what was new about the British experience was not that there had been sustained economic growth, for many countries had experienced rises in real income; even early 18th-century writers such as Richard Cantillon had seen that. The novelty was that income kept on growing.

This was in contrast to what had happened in the Netherlands, England's great trading rival, where advance in the 17th century had faltered by the 18th century. Wrigley argues that there was one reason why British economic growth carried on. Britain turned to a new source of energy; instead of biological sources, it sourced its energy from coal instead of wood.

Fifteen million acres of woodland would have been required to produce the same energy Britain got from coal in 1800, not to mention the labour that would have been required to maintain and harvest it. Without coal, bricks and sheet glass could never have become everyday building materials, as had happened by the mid 18th century in England (in marked contrast with France).

When ways were found to obtain mechanical energy from coal, through the steam engine, England broke free from an organic economy.

This story rests on much detailed analysis. Population is fundamental, not only because it affects the size of the market (Smith's explanation of why division of labour can take place) but also because occupational structure provides important evidence about a country's wealth and the types of goods it is consuming.

Wrigley's analysis, therefore, rests on close examinations of sources such as census returns and parish registers. For example, he finds his way through the minefield of early census data to draw conclusions about how the occupational structure changed in the early 19th century. Some of these details may tax the patience of all but specialists in the field, but they are important in laying the foundation for a fascinating story that challenges many preconceptions about a crucial period in British history.

Wrigley's interpretation of the Industrial Revolution offers a clear account of what happened in terms of population and the consumption of energy. On the question of why it happened, his account is more open and is not inconsistent with some others that have been offered.

Clearly, Britain's physical geography was vital. Without a climate that permitted agricultural productivity to be increased, and without terrain that provided opportunities for the growth of water transport, the advance could not have happened; without suitable supplies of coal and iron ore, it would not have been possible to break away from organic sources of power.

These changes also rest on a political and social environment that caused trade to grow. Geography was a sufficient condition but not a necessary one. We need an explanation of why the social and political structure of England encouraged the growth of markets and of why, right through the 18th century (and probably before) people responded by innovating in ways that raised productivity.

The intellectual developments that have been variously labelled "the English enlightenment" and "the industrial enlightenment" are also a vital part of the story.

Where does this leave the economists who lived during this period, such as Smith, Malthus and David Ricardo? They believed that economic growth would come to an end. Malthus and Ricardo clearly linked this to a shortage of fertile land.

Surely their forecasts were proved dramatically wrong? Wrigley argues that what they described is exactly what had happened in previous periods of industrial advance, notably in the Netherlands.

The reason they were wrong about late 19th-century England (and Smith barely lived long enough to see this) is that something totally unexpected happened: the switch to mineral energy. Without this, Ricardo's vision of a world where growth was constrained by the produce of the land would have been vindicated.

They got many things spot on. The growth of towns, much more marked in England than in other parts of Europe, had been crucial to economic growth, just as Smith realised: his model of urban growth seems to fit what had happened in England. Several years later, Malthus correctly observed that famine was due as much to the distribution of income as to the availability of food; his view of population growth fitted the available evidence.

This suggests that economic historians should once again take Smith, Malthus, Ricardo and their contemporaries more seriously as observers of their own societies, even turning to them for ideas on how to interpret what went on.

This book provides a warning. Wrigley's reinterpretation of the 18th century is of vital importance for anyone wanting to understand how economic ideas were evolving in the period from the English Civil War to the Victorian age.

Wrigley suggests that the gap between economic historians, who do not take past economists very seriously, and historians of economic thought, many of whom pay insufficient attention to economic history, needs to be reduced.

Roger E. Backhouse is professor of the history and philosophy of economics, Birmingham University.