According to North, "institutions change shapes the way societies evolve through time and hence is the key to understanding historical change"(1990:vii, 3). Poor economic performance is the result of inefficient institutional structures. The difference growth rates among nations are the result of different types of societal rules that nations have. The great progress made by England compared to Spain is the different institutional structure of the two countries. Spain adopted a conquest strategy while England used a commerce strategy. However, there are some who consider North's emphasis on the importance of institutions too naive. According to Donald Snooks, what determines the industrial climate and economic growth is not the institutions but individuals who are capable of making decisions (292).
Ideal institutional framework alone cannot achieve success in economic progress. There should be the apt technology for the success of any economic revolution. The Industrial revolution in England was fuelled by great technological change. This may be called the dynamic strategy of technological change. The growth that England showed in the middle ages was slowly losing the impetus by the 16th century and resulted in gradualism. This continued for many more years and the English economy stagnated in the early 1700(Wringley, 1994:32). ...Show more