Where did insurance start

where did insurance start



Industrialization in England

The Industrial Revolution began in England in the early 18th century for

the following reasons:

1. England had experienced all of the forerunners of industrialization in the previous century: an agricultural revolution, cottage industry, and an expanded commercial revolution. These developments had built surplus capital and an infrastructure

(shipping, banking, insurance, joint stock companies).

2. England already had a handcraft textile industry using wool, but with the availability of cotton from overseas markets as an alternative raw material.

3. The scientific revolution in England prepared the way for new inventions to be applied to industry.

4. A spreading shortage of wood (used for energy, for shipbuilding and

construction) stimulated a search for alternatives.

5. England was rich in supplies of coal for energy and iron for construction.

6. England had a long, irregular coastline with many rivers and natural

harbors which provided easy transportation by water to many areas.

7. England's population grew rapidly in the 18th century, providing a labor

force for industry.


In about 1765, Hargreaves invented the spinning jenny which could spin numerous spools of cotton simultaneously. It was hand-powered, yet it could multiply several-fold the amount to be spun.

At about the same time Arkwright invented the water frame which could spin several hundred spools at a time. But it required water power, and it could only spin coarse thread.

Both inventions were used, the one to spin coarse thread, the other to spin

fine thread.

About 1790, Crompton's Mule, powered by a steam engine, provided an alternative method.

Cotton yarn could be spun in great quantity, but weaving of cloth was by

hand until the power loom was perfected about 1800.

In the interim, weavers were well paid, until displaced by the power loom.

Thus, the employment market was dramatically changed twice in a short

period of time by the process of industrialization.


The shortage of trees for lumber had led to the use of coal for heating, but coal mines constantly flooded. Newcomen's steam engine, invented in 1705, was an inefficient but acceptable

method of pumping water out of the mines. It could not, however, generate power.

The new textile machines could be driven by water power, but that would

have set severe limits to the available locations. Furthermore, lack of

lumber threatened to cut short the industrial growth.

The iron industry consumed large quantities of lumber to produce charcoal, needed for production of pig iron. The iron industry was coming to a halt.

In the early 1760's through the 1780's, James Watt improved the design of the steam engine so that it could generate power. This was the most important of all the inventions of the time because it enabled coal to be burned to drive machinery.

Steam-driven bellows enabled coke (produced from coal) to be burned in a blast furnace rather than charcoal. In the 1780's Henry Cort developed the puddling furnace, and steam-powered rolling mills. These developments revitalized the iron industry.

All of the above developments were to change the source of energy from

wood to coal, and the preferred construction material from wood to iron.

These are hallmarks of industrialization.


The process would nevertheless have stagnated if there had not been a

revolution in transportation.

Iron rails were developed for coal carts to be hauled to nearby water transport. The combination of iron rails and the steam engine to transport people and goods was the railroad. This was the greatest achievement in transportation since ancient times.

Once accepted, it brought great numbers of consumers within reach of the growing volume of goods being produced. It made a market economy possible.

Industrial development on the continent lagged behind England for at least a generation. The separation of England from the Continent by the Napoleonic Wars delayed the spread of English technology. Eventually, industrialization spread, first to the lowlands and the northeastern United States, then eastward and southward across Europe and westward across North America. For per-capita levels of industrialization during the 19th Century, click here.

When it did come, English skilled technicians were much in demand and paid high wages. Governments played a more prominent role on the continent, particularly in the financing of railroads. These were the most visual evidence of industrialization, but required large amounts of capital.

Source: www2.sunysuffolk.edu

Category: Insurance

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