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A fiscal state with its Royal Navy:institutions and the industrial revolution.

Article Excerpt
'Good' institutions have become a core ingredient of most modern day explanations of economic growth and development. The recently published WIDER book on Institutional Change and Economic Development (see the previous Angle article by Ha-Joon Chang) emphasizes that what is appropriate as an institutional framework for development in one context, might not be appropriate in another. This implies that there might be important historical specificity in the relationship between institutions and development. In this article I illustrate this link between institutions, history and development, by describing the institutional context which led during the eighteenth century to the First Industrial Revolution, arguably one of the most significant events in the economic history of the modern world. Why, and how, did the Industrial Revolution happen to take place in the United Kingdom (UK) when it did?

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In this article I argue that to some significant degree an Industrial Revolution emerged in the UK as the outcome of aggressive and successful mercantilism. In the beginning was a fiscal state with its Royal Navy.

The Formation of a Fiscal State

Not long after the First Hundred Years War (1337-1453) when England's feudal armies had ignominiously retreated...

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