The British invent the idea of owning an idea – then never look back

I was passing by the Clyde whilst on business up north and the docklands view reminded me that this was the birthplace of James Watt, the inventor of the steam engine. As the story goes, his eureka moment occurred when he noticed steam raising the lid of a boiling kettle. And from this thought the industrial revolution began – the biggest event since the invention of farming.

Of course, James Watt didn’t invent the steam engine. Over two thousand years ago the Chinese, Indians, Greeks and Egyptians had all built steam engines. Why did they not have an industrial revolution? Because the other civilisations treated the steam engine as a toy whilst the British treated it as a way of making money.

Was this because the British were greedy and the others peoples not? No way. There are greedy people everywhere. The difference was that in Britain, unlike these other places, if someone invented a new machine the state would allow him to treat his invention as his own property to sell, rent, lease or licence at will. This had the effect of allowing people to gain wealth by creating new ideas. Britain was the first country to provide legal protection in this way.

Was British patent law the only reason that the industrial revolution began here? No – but it was the only reason I can think of that did not exist anywhere else. Many countries had coal. Many had iron. Quite a few had coal and iron of good quality in the same place and near the surface too. True, British literacy and numeracy in James Watt’s day was far higher than many other peoples. Also, the British state tended to be more tolerant of people with different beliefs: Watt (Presbyterian), Newcomen (Baptist) and Darby (Quaker) were dissenters. Even the fact that we drank tea was a contributor to our industrial dominance but then the Japanese also drank tea.

So the industrial revolution began here because we had a well-educated, tolerant society based on the rule of law but most importantly, through patent law, ordinary people could own the fruits, not just of their labour, but of their ideas as well. Necessity is not the mother of invention – it is patent law. As Abraham Lincoln succinctly put it “the patent system adds the fuel of interest to the fire of genius”.