Fewer, Richer, Greener

7The Great Enrichment: 1750 to Today

The Industrial Revolution and the Great Divergence

What is the most important event in history? Deirdre McCloskey makes the case for the economic transformation that began in the late eighteenth century:

Modern economic growth is the increase of income per head by a factor of 15 or 20 since the 18th century in places like Britain—and a factor of 8.5 worldwide, even including the places that have not had the luck or skill to let it happen fully. It is certainly the most important event in the history of humanity since the domestication of animals and plants, perhaps the most important since the invention of language. It bids fair to free us all, eventually.¹

Buried within this astonishing and accurate claim are two stories. One is the Great Enrichment: the “increase of income per head by a factor of 15 or 20 since the eighteenth century.” The other is the Great Divergence: that it happened in only some places, leaving others behind.

We started this Chapter 6, “Before the Great Enrichment,” with bearlike Angus Maddison, the old-economic-data detective, so let’s see what he had to say about the Great Divergence (not the First Divergence, but the big one that started around 1750). Figure 7.1 shows his reconstruction of the growth of incomes in selected countries from 1750, the earliest plausible starting date for the Industrial Revolution, to 1870, when the benefits from that revolution had become widespread and a Second Industrial Revolution ...