#341 - Living Standards And The Industrial Revolution - British Economic History

Supervision 4: Living Standards and the Industrial Revolution British Economic History, Paper 5, Part I Essay: 'Recent evidence confirms that the Industrial Revolution conferred few benefits on the majority of those who lived through it.' Discuss. The debate about the standards of living in Britain during the Industrial Revolution is one of the most famous and controversial topics in economic history. One the one hand, the pessimists argue that the standard of living of the labouring poor deteriorated during the early industrialisation. On the other hand, the optimists see improvements in the quality of life for the majority of the people. The discussion concentrates on the time period of ca. 17601850. Since the 1980s, most new research concerning the standards of living has tended to support the pessimist position. An important work about real wages supporting the optimists' position was made by Lindert and Williamson (1983). Real wages can be seen as an important input in the standards of living, because they determine the level of consumption. Lindert and Williamson looked at wages paid to a range of male adult employees to get the average wage rate for different groups of occupation. As they looked to the labour class directly, it also helped to address the topic of widening inequality. The question whether only a few benefited from the early Industrial Revolution can be answered if we look at wage developments of workers. Lindert and Williamson further developed a costofliving index in order to calculate the rise in real wages. Their result shows that real wage trends are variable until 1820, after which continuous growth occurs. By 1851, the wage rate for all workers was 155% higher than in 1781, which is a marked rise and was used as evidence by Lindert and Williamson to postulate that "the debate should be over". This strong optimistic view was contested by Horrell and Humphries (1992). They considered the income development at the household level, as this is the variable which determines consumption for individuals. If there were less working opportunities for women and children, the rise in disposable income for the family must be less than the rise in male earnings suggests. Horrell and Humphries used household budget data and included occupations and paymentsinkind omitted by Lindert and Williamson. This resulted in a downward revision of the increase in income. The increase of 95% by Lindert and Williamson in male earnings 1