The Hand-Loom Weaver and the Power Loom: A Schumpeterian Perspective Robert C. Allen Working Paper # 0004 May 2017 Division of Social Science Working Paper Series New York University Abu Dhabi, Saadiyat Island P.O Box 129188, Abu Dhabi, UAE https://nyuad.nyu.edu/en/academics/divisions/social-science.html The Hand-Loom Weaver and the Power Loom: A Schumpeterian Perspective REVISED by Robert C. Allen Global Distinguished Professor of Economic History Faculty of Social Science New York University Abu Dhabi P.O. Box 129188 Abu Dhabi United Arab Emirates Senior Research Fellow Oxford University Nuffield College New Road Oxford OX1 1NH United Kingdom
[email protected] The empirics of this paper rest on John Lyon’s Ph.D. dissertation The Lancashire Cotton Industry and the Introduction of this Powerloom, 1815-1850. This is an impressively well informed and thorough reconstruction of the technology and economics of the industry. This paper could not have been written without it. John Lyons sadly died in 2011. I dedicate the paper to him. This is a revised version of a discussion paper originally issued as Oxford University, Working Papers in Economic and Social History, Number 142, 2016 2017 Abstract Robert C. Allen The Hand Loom Weaver and the Power Loom: A Schumpeterian Perspective , Schumpeter’s ‘perennial gale of creative destruction’ blew strongly through Britain during the Industrial Revolution, as the factory mode of production displaced the cottage mode in many industries. A famous example is the shift from hand loom weaving to the use of power looms in mills. As the use of power looms expanded, the price of cloth fell, and the ‘golden age of the hand loom weaver’ gave way to poverty and unemployment.