ABSTRACT
The economic analysis of industrialisation would be deepened if environmental factors were taken into account. In addition, the effects of environmental pollution on health tend to be classified as a 'social effect' of industrialisation. The classic Industrial Revolution period saw an initial increase in the use of organic energy sources - water, wind and wood, as well as animal and human power. Green industrialisation would have been feasible, therefore; but it would certainly have been much slower and might have brought environmental disbenefits as well as advantages. The economy's total capacity to produce and consume other products, particularly agricultural goods, would have been adversely affected and living standards would have been lower. The French experience suggests that cheap power was crucial to rapid industrialisation. A comprehensive system of charging would have incurred enormous transaction costs and thus would have had its own economic drawbacks.
