State Space Models

All state space models are written and estimated in the R programming language. The models are available here with instructions and R procedures for manipulating the models here here.

Wednesday, October 29, 2025

World-System (0-2000) What Caused the Industrial Revolution?

                 

The graphic above is a time plot of World Aggregate Production (W_Q) taken from Maddison (see the Boiler Pate).  The growth of Capitalism is typically data from 1500-Present with a clear visible take-off starting in the 19th Century. The burning question is "Why"!


ChatGPT (an AI Systems) produces the graphic above as an answer to the question "What Caused the Industrial Revolution".*** One can quibble with some of the links in the graph ("Why aren't Profits plowed back into the production process?", "What about Environmental Impacts?", etc.), but the graph is a good place to start.


The Kaya Identity is another good place to start (notice the Kaya Identity does not have feedback loops).

The causes of the Industrial Revolution are not possible to consider in one post, but I think there is a causal explanation that has been missed and I will investigate it in future posts.


Notes


*** Actually, my question was about feedback loops in the Industrial Revolution but you can asked the "What Caused" question yourself here. Google AI provides the following answer:

AI Overview
The main causes of the Industrial Revolution include 
  • combination of the Agricultural Revolutionwhich freed up labor and increased foodproduction;
  • technological innovations like the steam engine and new machinery that mechanized production;
  • access to natural resources such as coal and iron;
  • economic and political factors like capitalismavailable capitaland supportive government policies;
  • and an increase in population growth and made, which created both work force and demand for goods.

Agricultural advancements

The enclosure movement:Landowners consolidated smaller plots of land, making farming more efficient and forcing many rural laborers to seek work in cities.
New farming techniques:Innovations like Jethro Tull's seed drill increased crop yields, supporting a larger population.

Technological innovation

New inventions:

Key inventions like the spinning jenny, water frame, and steam engine revolutionized production in the textile and other industries.

Mechanization:
Machines could produce goods faster and more cheaply than by hand, leading to the development of the factory system.
Economic and political factors
Capitalism:
An economic system with private property and free enterprise encouraged investment and risk-taking.
Available capital:
A large amount of money was available for investment in new businesses and technologies.
Supportive government:
Policies, such as those protecting property rights and patents, encouraged innovation and industrial growth.
Abundant natural resources:
Britain, the birthplace of the revolution, had large deposits of coal for power and iron for machinery, often located near waterways for transport.
Growing population:
Population growth provided both a large workforce for factories and a bigger market for consumer goods.
Improved transportation:
Systems like canals and later railroads made it cheaper and faster to transport raw materials and finished products.

References















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