Adam Smith, Watch Prices, and the Industrial Revolution

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Citation: Morgan Kelly, Cormac Ó Gráda (2016/09/16) Adam Smith, Watch Prices, and the Industrial Revolution. Quarterly Journal of Economics (RSS)

doi: 10.1093/qje/qjw026


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Summary:

Authors evaluate Adam Smith's claim that watch prices had fallen 95% in a century using records of criminal trials in the Old Bailey to track the path of watch prices from the late 1600s to the mid-1800s. Authors find 75% decline, or 87% accounting for quality.

Evidence for increasing productivity during the 1700s in the watch industry indicates earlier start of industrial revolution productivity increases than work focused the low (cotton and iron) and high (steam and machine tools) industrial revolutions. Watchmaking complemented navigational and scientific instrument making and contributed to the high industrial revolution.