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Industrial Development in Great Britain

These conditions might have directly favored industrialization in one respect, by freeing more of the population for other pursuits, while producing sufficient output to feed them. However, in the absense of a preexisting market, the more likely outcome of a production increase would simply be falling prices and an agricultural depression. The total demand for agricultural products, which are mainly "food and clothing" shows little elasticity in volume, although the "basket" of goods demanded is highly variable. Unless the extra output can find new markets, it will in effect simply pile up in barns. The surplus will drive prices down, and with them farm earnings.

But the British agricultural market was not closed. Particularly in the Thames Valley and the eastern regions of England, comparative series show that grain prices closely tracked prices on major European grain markets.7 From some areas was as easy to export abroad, in terms of transportation prices, as to ship coastwise to other parts of Britain. Moreover, European agriculture tended to progress less slowly than Britain's, so that British farm exports gained a comparative advantage.

This, according to the exportengine theorists, provided the ________

6J. D. Chambers and G. E. Mingey, The Agricultural Revolution (New York: Schocken Books, 1966), 5475; for enclosure see 77ff.

7John, 23839. first kick to the English economic engine. Because of expanded sales in international markets, farm output rose as prices fell, so incomes at least held steady. With food prices dropping while incomes remained relatively high, a greater margin was made available for either nonfood consumption or economic investment.

An alternative view, presented for example by Eversley, might be called "demand side" economics.8 It also starts with an environment of falling farm prices and steady wages. In this environment, the gradual overall growth...

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