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The Industrial Revolution in Scotland

Thursday, January 22nd, 2026

Tobias Lunde

The Scottish Lowlands was one of the world’s first industrialised regions. By the early 19th century, Scotland was the global centre of several industries; Glasgow was the Second City of the Empire; and Edinburgh was a centre of the Enlightenment, home to both Adam Smith and David HumeSeveral seminal innovations from the period were made by Scots, including James Watt’s critically important improvements to the steam engine; Andrew Meikle’s threshing mill; and Charles Tennant’s bleaching powder. Despite this, however, Scotland is almost entirely absent from the vast literature on the Industrial Revolution. 

James Eckford Lauder, James Watt and the Steam Engine: The Dawn of the Nineteenth Century. National Galleries of Scotland.

The absence is unfortunate, because Scotland’s transformation may teach us much about the hows and whys of early industrialisation. In what ways was it similar to England’s transformation, and in what ways did it differ? The answers to these questions have implications for how we are to understand the process of early industrialisation. 

The transformation of Scotland started later and was much more contracted than in England. Wages were much lower in Scotland than in England prior to industrialisation. Skilled labourers were almost entirely absent from 17th-century Scotland, quite unlike England. However, it was not a simple case of Scotland “catching up” to Englandin several important ways, Scotland eventually took the lead.  

The transformation of Scottish industry

While the beginning of the Industrial Revolution used to be dated to c.1760, recent research has shown that the industrialisation of England was already well underway by the 17th century. There is no evidence of a similar early transformation in Scotland. By the time of the Act of Union between Scotland and England in 1707, Scotland was one of the least urbanised countries in Europe. There were only a few fledgeling attempts at manufacturing, and the few products Scots did manufacture for trade were largely of low quality. 

Wages appear to have been considerably lower in Scotland than in England. Estimates suggest craftsmen’s real wages were about 75 percent lower in Scotland compared to England in the 1640s. In the 1730s, they were 66 percent lower due to stagnating wage growth in Scotland. 

In the first half of the 18th century there are signs of increased urbanisation in Scotland, driven by a declining mortality rate, and around 1760 manufacturing output started to increase considerably. From that point, towns grew rapidly and new ones appeared, primarily located on coal fields, near rivers and the coast, with easy access to coal, waterpower, and trade routes. By 1800, Scotland was one of the fastest urbanising countries in Europe.  

In the western Lowlands, manufacturing was focused on cottons and cheaper printed textiles. The eastern Lowlands produced linens and coarse textilesSpecialised manufacturers appeared throughout the Lowlands, often in energy-intensive industries near coal mines. The Carron Works, established in 1759, became one of the largest iron works in Europe. The St Rollox Chemical Works was established in 1799, and by the 1830s it was largest chemical manufacturer in the world. By the 1850s, Dundee had a near global monopoly on the manufacture of jute. At that point, the occupational structure of Scotland was similar to that of England. 

The transformation of Scottish agriculture

During the 17th century, farmers in some parts of England, such as Norfolk and Suffolk, had started to introduce new ways of farming. There is no evidence of a similar early shift in Scotland. By the early 18th century, only a small handful of wealthy estate owners had introduced new crops, agricultural technologies, and methods on their own farms. Potatoeswheat, crop rotationsand drainage systems remained rarities in Scotland until the mid-18th century, and the “Old Scots plough, or cas-chrom, remained commonIt is a simple implement where a wooden stick with an iron sock at the tip is used in a way that is more akin to scratching the soil, and which often required eight oxen. In parts of England, ploughs with wheels and mouldboards that turn the soil and required fewer animals had been common since the 17th century. 

However, once the transformation of Scottish agriculture started, it was rapid. The old outfields and infields were turned into flat, drained fields; new crops were introduced; and farmers experimented with a wide range of crop rotations. In the 1780s, the Scottish farmer and agriculturalist John Small invented his swing plough. It made numerous, smaller improvements on ploughs he must have seen while in Yorkshire. It was better at turning the soil, required less animal force, and increased ploughing speedBy the 1790s it was in widespread use in Scotland.  

In 1786, Andrew Meikle made the first working version of his threshing mills, which automated the process of separating grains from straw – previously a very labour-intensive process. Several people had attempted to automate threshing before Meiklebut his design was the first that became widely used, and it became the standard mechanism for threshing mills going forward. By the 1790s several farmers had installed threshing mills and by 1810 they were common in several counties. The first steam powered threshing mill is claimed to have been installed by a Scottish tenant farmer in 1811, and by the 1830s they appear in 35 parishes. The rapid transformation of Scottish agriculture was undoubtedly aided by learning from foreign farmers, but Scots also made key contributions.  

A. Reddock, Andrew Meikle; National Portrait Gallery, London.

Explaining the Industrial Revolution in Scotland

Several widely-cited explanations for why the British Industrial Revolution happened where and when it did fare poorly in light of the transformation of Scotland. Robert Allen has famously argued that Britain had a unique combination of relatively expensive labour compared to the cost of energy. This is supposed to have incentivised people to innovate and adapt labour-saving technologies, thereby leading to technological improvements and the Industrial Revolution. However, labour was relatively cheap and abundant in Scotland – yet despite this lack of the incentives described by Allen, Scots still innovated and adopted labour-saving technologies. 

Joel Mokyr has emphasised the role of enlightenment thinking and innovations in the Industrial Revolution. Together with Morgan Kelly and Cormac ÓGráda, he has argued that early industrialisation occurred in places with low wages and high mechanical skill. The main reason for Britain’s transformation, they argue, was a high level of human capital. However, while Scotland did become a centre of the Enlightenment, it was notably lacking in skilled labour in the early 18th century. In response to this shortfall, foreign skilled spinners, weavers, and bleachers were ‘induced’ to move to Scotland. 

Then how are we to explain the transformation of Scotland? Four factors appear to have been important. First, the European Enlightenment – this may help explain the timing of industrialisation in Scotlandas the increase of economic activity coincided with a broad engagement with Enlightenment thinking in Scottish society 

Second, coal – this may help explain the location of Scotland’s Industrial Revolution, given how centred and dependent Scottish industry and urbanisation was on coal. Third, colonial trade played a vital role in every major Scottish industry, by providing a combination of capital, raw materials, and demand for manufactured goods. 

John Atkinson Grimshaw, Shipping on the Clyde, 1881.

Finally, population growth appears to have played a key roleEvidence is scant, but it seems fairly clear that the Scottish population started to grow decades before the economy did, due to a decline in mortality. This allowed for “Smithian growth” driven by division of labour and regional specialisation, and which was aided by the increased market access that resulted from the Act of Union. 

We do not know what caused the decline in mortality in Scotlandand it is clearly something in need of further research. However, it seems highly likely that the decline was driven by the same factors that caused the decline in English mortality. 

The major differences between England and Scotland suggest that the Industrial Revolution was far from a geographically uniform process. Widely cited claims about its timing and character do not align with the Scottish evidence. It may therefore be more appropriate to think of the Industrial Revolution as a regional and geographically uneven phenomenon, rather than a single, British experience. Widely accepted generalisations about the British Industrial Revolution may need to be revised or at least confined to England. 

Further reading

  • Allen, R., The British Industrial Revolution in Global Perspective (Cambridge University Press, 2009). 
  • Durie, A. J., The Scottish Linen Industry in the Eighteenth Century (1979). 
  • Gibson, A. J. S., and Smout, T. C.. Prices, Food and Wages in Scotland, 1550 – 1780 (Cambridge University Press, 1994). 
  • Kelly, M., Mokyr, J., and Ó. Gráda, C., ‘Precocious Albion: A New Interpretation of the British Industrial Revolution’, Annual Review of Economics 6:1 (2014). 
  • Kelly, M., Mokyr, J., and Ó Gráda, C., ‘The Mechanics of the Industrial Revolution’, Journal of Political Economy 131:1 (2023). 
  • Lunde, T., An Economic Geography of the Industrial Revolution in Scotland, c.1760–1840. PhD thesis (University of Cambridge, 2022). doi:10.17863/CAM.99086. 
  • Mokyr, J., The Enlightened Economy: An Economic History of Britain 17001850 (Yale University Press, 2009). 

The forgotten Chinese serfs who picked tea for Victorian England

Thursday, December 18th, 2025

Christoph Hess

In 19th-century England, afternoon tea would not have been complete without a serving of Keemun one of the Victorians’ most prized black teas. This was not for a lack of choice. A secret operation headed by the Scottish botanist Robert Fortune, who donned Chinese-style garments to travel incognito to China’s tea regions, had seized the secrets of tea production and successfully established plantations in British India from the 1850s on. But many British consumers kept a taste for Chinese teas, especially the malty and slightly smoky Keemun, which, when scented with bergamot, made an excellent Earl Grey. What they may not have known was that their love for a cup of Keemun connected their warm salons to a group of Chinese serfs who picked the tea leaves from the steep mountain slopes of Qimen (old: Keemun) County in East China. 

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Beyond the microbe: why social institutions matter for epidemics

Thursday, November 20th, 2025

Sheilagh Ogilvie 

The Covid-19 pandemic rightly focused our attention on medical science. But working on economic history and historical demography, Ive always been struck by how the outcomes of epidemics are shaped by more than microbes and medicines. Why did some societies suffer so much more than others? Why were some life-saving innovations adopted quickly in one place, but rejected for decades just a few miles away? 

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The struggle to define self-employment

Thursday, June 5th, 2025

Bob Bennett

Distinguishing someone who is self-employed from another who is waged seems at first obvious: one works for themselves, the other works for others. However, the distinction was often far from simple in the past, and today has been politically contested.  

The differences between employment and self-employment are important for demographic analysis, potentially affecting risk and legally who is responsible for hazards at work. It is important for economic analysis because it reflects different levels of agency or freedom and the dynamics of many businesses. It may be a critical influence on income: a very few who are self-employed may get astonishingly rich. It is also important for understanding motivation, possible levels of self-fulfilment, and how different people respond to changing demands and opportunities in an economy. This all has important historical and policy implications. 

Photo by Dominik Bednarz on Unsplash.

Modern discussions often focus on agency work and zero-hour contracts: is someone self-employed, or are they de facto employed by a business contracting them and giving minimal security? Should this be regulated by government? How should trade unions be involved? How should laws balance between people’s wish for flexible working, and for employers’ response to workforce needs that can fluctuate widely from day to day or week to week? 

The Employment Rights Bill considered by the UK parliament in 2025 is attempting to define and enforce the differences between self-employment and being waged. Its discussion in Parliament and outside demonstrates the current difficulties of definitions, but these are of long standing. 

When did the distinction become important? 

Historically there was freedom between contractors and employers to determine how they would be classified – as self-employed or employees. Arrangements were flexible and often ambiguous. The main force that began to change things was income tax.   

In Britain, income taxes on profits of trade and farming began in 1798, but only became continuous in 1842. Mostly those liable were clearly defined by the nature of their trade, and while the tax rate remained low it was not worth much effort to challenge it. Difficulties began when taxes on wages, which were minor at the outset, were widened in the late 19th century. It then became increasingly necessary to distinguish between waged and self-employed. However, this was initially fairly simple because only ‘salaries’ were taxed (generally affecting only higher earners). 

Arthur Whinnom, Pay Day. Woodhorn Museum.

Major difficulties emerged during and after WW1, when tax rates rose rapidly and the rate of tax on profits became considerably lower than that on wages. When an additional tax on payroll (NICs) was expanded after 1948, this taxed employees even higher than the self-employed. The spiral intensified as governments often favoured increasing NICs on payrolls rather than income tax rates as they were less politically visible. These changes resulted in a 100-year long shift of incentives for people to define their income as self-employment wherever possible.  

During the 1980s and 1990s, the numbers of self-employed increased for structural reasons, but a major element of growth was purely driven by ‘tax efficiency’ – that is, people who claimed they were self-employed when the justification was at best marginal or even bogus. 

Inevitably, tax collectors were keen to limit this effect. The most concerted attack was the IR35 rule introduced in 2000. This set a specific test: that having a regular single or main employer meant you were an employee, even if you were a one-person company. To be self-employed you had to be working on different contracts for different people, with independent negotiation of your prices and costs, whether you were a company or not. This test was up to individuals and had little effect. But in 2017 the test was shifted to public sector employers to determine liability. Employers were also made responsible for collection and any errors in definition (as for other employees through PAYE). This responsibility was extended to private sector employers in 2021.  

There was a ‘flight to safety’. A small reduction occurred of self-employed numbers in 2018, but there were large reductions from 2022. Many of the remaining own account proprietors contracted to large organisations moved to ‘umbrella’ agencies that administer their incomes. In the Figure 1 (below) it is difficult to separate this effect from the Covid pandemic, but most of the 2021-2 reduction is estimated to be the effect of the change in IR35 rule. Highly-paid celebrities who had claimed to be self-employed though working for a media company or the BBC made a lot of noise about their loss of self-employment. However, at the other extreme, many poorly rewarded agency staff were incorrectly classified as employed. The 2025 Employment Rights Bill attempts to tighten these definitions further. 

Figure 1. Self-employment in England and Wales 1994-2024. Source: LFS. [Discontinuities in data definitions over early years have been smoothed].

The ‘gig economy’ 

The ability for online platforms using Apps to connect suppliers of services with consumers has challenged some of the old regulations. Celebrated recent legal cases in Britain have had to define self-employment in light of these new circumstances. However, although the technology may be new, the decisions are almost identical to long-standing distinctions. 

For example, Uber in London was found by the Supreme Court in 2021 to be an employer. Their cab drivers were not self-employed; the contract for hire was between the passenger and company, not between the passenger and the cabbie despite them ordering through an App 

The fine distinctions are clear from Deliveroo, where the Supreme Court found it was not an employer in 2023. In that case, the rider had freedom to accept or reject jobs and could do jobs for others. This may change under the 2025 legislation in parliament. 

Historical examples

The building industry is well-known for the difficulties of definitions. In the past, as now, the smallest and most numerous group of self-employed were jobbing builders: own account and small partnerships that employed only themselves or a small workforce. Most were single tradesmen such as bricklayers, joiners and carpenters or masons. Many larger firms employed these individuals and small partnerships on large jobs. Were the small sole proprietors then employed, or self-employed? 

Firms varied. The largest contractors for railways, canals and dock construction usually hired all navvies and most other workers for the life of the project, and had few permanent staff. In contrast, even the largest ‘master builders’ responsible for constructing churches, public buildings and factories mostly had a core permanently employed workforce of skilled craftsmen and foremen. When needed they employed labourers and a few extra self-employed craftsmen as extras. These workers might continue to be self-employed or be put on the employer’s payroll.  

One way to examine definitions is to look at pay ledgers. Detailed accounting in building firms for personnel attributed to each contract was used to calculate tenders, monitor works, and negotiate any extras needed on completed works. Ledgers were often divided into salaries for foremen, clerks, managers and senior staff, and wages for tradesmen. For John Mowlem & Co. in the 1880s, almost all people were on continuous pay ledgers; only lightermen, carters and extras on piece-work were recorded as self-employed 

Dock Workers, Dundee. University of Dundee, Duncan of Jordanstone College Collection.

Franchises and ‘tied’ activities 

Pubs, inns and beer houses were often owned or tenanted by those who operated them, making them a nationwide source of self-employment, often important for women. Some pubs were tied to breweries who appointed waged managers, but until the late 19th century many tied pubs were tenancies run by the proprietor, with the tie only restricting the drink sold. Most innkeepers were self-employed. 

Some tied pubs were an early form of franchise. Franchises have become a very common business model in modern times. Much depends on the franchise contract as to whether they are sources of self-employment. Most modern fast-food chains and retailers rarely qualify as run by the self-employed. They are de facto branches, though there may be incentives with wages linked to size of turnover. 

Martha Matilda Harper is often credited as creating the first franchise model. Through domestic service she saved enough to open a hairdressers and began selling hair products, especially shampoo. Her business expanded by opening branches where she selected and trained other women using her brand. She had over 500 shops operating across the USA by late the 19th century; but their staff were de facto her employees. 

Isaac Singer’s Sewing Machine Company licenced the rights to sell its machines through agents who were charged a fee. Initially operating in the USA, the business expanded rapidly and by 1867 opened a factory in Glasgow, expanding to 60,000 sales per year by 1880 using about 300 offices in Britain, with numerous agents selling the machines.  

The Prudential used almost entirely an agent model to sell insurance policies: ‘the man from the Pru collected from the door. Founded in 1848 and incorporated in 1861, it had 10,600 agents by 1888 and 18,000 by 1902. Theoretically they could be self-employed, and initially many were also agents for other businesses. But in 1875 almost all were full-time working only for the Pru as de facto employees. The Pru’s district offices were almost entirely concerned with managing the agents. 

Worker-contractors and outwork  

Worker-contractors and outworkers highlight the problematic distinctions between self-employed and workers. Outworkers generally operate at home. Some could exercise a lot of control over the amount of work they took in, whether it was from one or multiple sources, and had some level of control over prices. Under these criteria they could argue they were self-employed. However, independence required not only motivation but realistic opportunities to trade independently. The majority of outworkers had no opportunities to exercise controls, and may not have wished to do so, preferring the security of a fixed price per piece or contract if the employer was viewed as fair. 

One manufacturer locally viewed as fair and having no history of disputes was Daniel Gurteen & Sons of Haverhill, Suffolk, a clothing, towelling, rug and hosiery manufacturer. In 1888 they had a major works with some 1,500 workers, two-thirds female. Additionally another 1,500 or so did work at their homes in the villages around. They had a fixed rate and their work was checked and managed. Old men with donkey carts took out and fetched back the work. Not only did these locals have little motive to trade independently, but Gurteens in any case monopolised most contracting opportunities.

Self-employment in 19th century Britain was not just about the trade or the person’s motives and desires for independence. It was also about where they were, and the scope their town offered to run an independent business. 

National statistics

In the 1891 Census, for the first time, everyone who was economically active was supposed to identify as either a worker, employer, or working on own account. Combining the last two of these categories should give us a count of all ‘self-employed’; everyone else who was economically active was a worker. 

Unfortunately, various defects in the wording and design of the 1891 census, and also its administration, make the resulting information difficult to use. The question was re-designed in 1901. The fundamentals of the census question then continued until the modern censuses, though in almost all censuses the challenges of definition of self-employment make the responses problematic in detail.  

The 1901 census question.

It is notable that the census did not define an employer of domestic servants as an employer: these employers were not counted in census number, yet domestics were counted as employees – resulting in difficulties of balancing estimates of national self-employment rates. 

As a result of this and other difficulties of census design, most modern economic analysis has used the Labour Force Survey (LFS) in preference to the census. This was introduced in the 1970s. However, even this has suffered major problems, and since the 2010s has had severely declining response rates. The Bank of England and others needing an accurate view of self-employment in the economy have been highly critical. In the late 2020s it is planned to introduce a new version of the LFS. Defining self-employment remains a continuing problem! 

Further reading 

Open access 

Paywall 

  •  Bennett, R. J., Smith, H., van Lieshout, C., Montebruno, P., Newton, G., The Age of Entrepreneurship: Business proprietors, self-employment and corporations since 1851 (Routledge, 2019). https://doi.org/10.4324/9781315160375 

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Who was self-employed in the past?

Thursday, May 22nd, 2025

Bob Bennett 

It is often assumed that industrial Britain, with its large factories and mines employing thousands of people, left little space for individuals running their own businesses. But not everyone was employed as a worker for others. Some exercised a level of agency operating on their own as business proprietors, even if they were also often very constrained.

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Industriousness and precarity: work before the Industrial Revolution

Thursday, May 15th, 2025

Judy Stephenson

The concept of an ‘industrious revolution’—a period when household productivity and consumer demand increased before industrialization, generating surplus for investment in new technology—has been influential since the late 1990s. For economic historians, the measure of industriousness is the number of days people worked per year. For anybody who was paid by the day, annual income was a function of the portion of the day rate that they received, and the number of days that they received it for. How many days people worked per year is therefore of profound importance to understanding preindustrial living standards, as well as economic growth.  

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The rise of coal

Thursday, May 1st, 2025

Paul Warde

In the 19th century , no-one doubted the significance of Britain’s use of coal in underpinning its economic and political power – foreign neighbours envied Britain’s resources and mining industry long before the term ‘Industrial Revolution’ came into widespread use. In more recent decades, understanding about how burning fossil fuels has led to climate change puts a new complexion on this epochal shift. It is not only associated with bursting the constraints of the organic economy, but also bringing new hazards on a global scale. What happened in Britain takes on a new significance. 

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The growth of the service sector

Thursday, January 16th, 2025

Leigh Shaw-Taylor 

The service sector, also known as the tertiary sector, comprises all workers not making a physical product. This includes shopkeepers, wholesalers, publicans, hotel workers, people working in financial services, health and social care workers, professional services, and transport workers. 

The UK economy today, like that of all rich countries, is dominated by the service or tertiary sector. According to the 2021 census, fully 76 percent of the labour force is now in the tertiary sector. But when did the service sector become dominant, and when did it begin to grow? Many people think the growth of the service sector is a recent phenomenon, starting perhaps in the 1950s and picking up speed as Britain de-industrialised from the 1970s. However, new long-run data on male occupations collected by the Occupational Structure of Britain c.1379-1911 project tell a different story. 

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Was the economy backward before the Industrial Revolution?

Thursday, December 5th, 2024

Leigh Shaw-Taylor

It is widely assumed that before the Industrial Revolution most people worked in agriculture, and that the economy was underdeveloped or backward. But was this really so? The first of these assumptions will be taken up in next week’s blog, while today’s blog will focus primarily on the second.  

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To the manor bound: Serfdom in Europe

Thursday, November 21st, 2024

Tracy Dennison

Serfdom is usually associated with the medieval period, and conjures images of an impoverished peasantry toiling under duress in the fields around the lord’s castle. This view is not so much incorrect as incomplete. In many parts of Europe, especially central and eastern Europe, there were still enserfed peasants in the 18th and 19th centuries. Serfdom disappeared from the European landscape gradually: first in England, in the decades after the Black Death, and last in Russia, by state decree in 1861.  

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